Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 23, 2018 | Jun. 30, 2017 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | QTS Realty Trust, Inc. | ||
Entity Central Index Key | 1,577,368 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | Yes | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Public Float | $ 2.6 | ||
Class A Common Stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 50,597,741 | ||
Class B Common Stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 128,408 | ||
Qualitytech, LP | |||
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | QualityTech, LP | ||
Entity Central Index Key | 1,561,164 | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
Current Fiscal Year End Date | --12-31 |
CONSOLIDATED FINANCIAL STATEMEN
CONSOLIDATED FINANCIAL STATEMENTS BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Real Estate Assets | ||
Land | $ 88,216 | $ 74,130 |
Buildings and improvements | 1,701,287 | 1,524,767 |
Less: Accumulated depreciation | (394,823) | (317,834) |
Total real estate assets | 1,394,680 | 1,281,063 |
Construction in progress | 567,819 | 365,960 |
Real Estate Assets, net | 1,962,499 | 1,647,023 |
Cash and cash equivalents | 8,243 | 9,580 |
Rents and other receivables, net | 47,046 | 41,540 |
Acquired intangibles, net | 109,451 | 129,754 |
Deferred costs, net | 41,545 | 38,507 |
Prepaid expenses | 6,163 | 6,918 |
Goodwill | 173,843 | 173,843 |
Other assets, net | 66,266 | 39,305 |
TOTAL ASSETS | 2,415,056 | 2,086,470 |
LIABILITIES | ||
Unsecured credit facility, net | 825,186 | 634,939 |
Senior notes, net of discount and debt issuance costs | 394,178 | 292,179 |
Capital lease, lease financing obligations and mortgage notes payable | 10,565 | 38,708 |
Accounts payable and accrued liabilities | 113,430 | 86,129 |
Dividends and distributions payable | 22,222 | 19,634 |
Advance rents, security deposits and other liabilities | 28,903 | 24,893 |
Deferred income taxes | 4,611 | 15,185 |
Deferred income | 25,305 | 21,993 |
TOTAL LIABILITIES | 1,424,400 | 1,133,660 |
EQUITY | ||
Common stock, $0.01 par value, 450,133,000 shares authorized, 50,701,795 and 47,831,250 issued and outstanding as of December 31, 2017 and 2016, respectively | 507 | 478 |
Additional paid-in capital | 1,049,176 | 931,783 |
Accumulated other comprehensive income | 1,283 | |
Accumulated dividends in excess of earnings | (173,552) | (97,793) |
Total stockholders' equity | 877,414 | 834,468 |
Noncontrolling interests | 113,242 | 118,342 |
TOTAL EQUITY | 990,656 | 952,810 |
TOTAL LIABILITIES AND EQUITY | 2,415,056 | 2,086,470 |
Qualitytech, LP | ||
Real Estate Assets | ||
Land | 88,216 | 74,130 |
Buildings and improvements | 1,701,287 | 1,524,767 |
Less: Accumulated depreciation | (394,823) | (317,834) |
Total real estate assets | 1,394,680 | 1,281,063 |
Construction in progress | 567,819 | 365,960 |
Real Estate Assets, net | 1,962,499 | 1,647,023 |
Cash and cash equivalents | 8,243 | 9,580 |
Rents and other receivables, net | 47,046 | 41,540 |
Acquired intangibles, net | 109,451 | 129,754 |
Deferred costs, net | 41,545 | 38,507 |
Prepaid expenses | 6,163 | 6,918 |
Goodwill | 173,843 | 173,843 |
Other assets, net | 66,266 | 39,305 |
TOTAL ASSETS | 2,415,056 | 2,086,470 |
LIABILITIES | ||
Unsecured credit facility, net | 825,186 | 634,939 |
Senior notes, net of discount and debt issuance costs | 394,178 | 292,179 |
Capital lease, lease financing obligations and mortgage notes payable | 10,565 | 38,708 |
Accounts payable and accrued liabilities | 113,430 | 86,129 |
Dividends and distributions payable | 22,222 | 19,634 |
Advance rents, security deposits and other liabilities | 28,903 | 24,893 |
Deferred income taxes | 4,611 | 15,185 |
Deferred income | 25,305 | 21,993 |
TOTAL LIABILITIES | 1,424,400 | 1,133,660 |
EQUITY | ||
Accumulated other comprehensive income | 1,449 | |
TOTAL PARTNERS' CAPITAL | 990,656 | 952,810 |
TOTAL LIABILITIES AND EQUITY | 2,415,056 | 2,086,470 |
Limited Partner | Qualitytech, LP | ||
EQUITY | ||
TOTAL PARTNERS' CAPITAL | $ 989,207 | $ 952,810 |
CONSOLIDATED FINANCIAL STATEME3
CONSOLIDATED FINANCIAL STATEMENTS BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 |
CONSOLIDATED FINANCIAL STATEMENTS BALANCE SHEETS | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 450,133,000 | 450,133,000 |
Common stock, shares issued | 50,701,795 | 47,831,250 |
Common stock, shares outstanding | 50,701,795 | 47,831,250 |
CONSOLIDATED FINANCIAL STATEME4
CONSOLIDATED FINANCIAL STATEMENTS STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues: | |||
Rental | $ 335,819 | $ 295,723 | $ 230,510 |
Recoveries from customers | 37,886 | 29,271 | 22,581 |
Cloud and managed services | 65,466 | 68,488 | 51,994 |
Other | 7,339 | 8,881 | 5,998 |
Total revenues | 446,510 | 402,363 | 311,083 |
Operating Expenses: | |||
Property operating costs | 153,209 | 136,488 | 104,355 |
Real estate taxes and insurance | 11,959 | 8,840 | 5,869 |
Depreciation and amortization | 140,924 | 124,786 | 85,811 |
General and administrative | 87,231 | 83,286 | 67,783 |
Transaction, integration and impairment costs | 11,060 | 10,906 | 11,282 |
Total operating expenses | 404,383 | 364,306 | 275,100 |
Operating income | 42,127 | 38,057 | 35,983 |
Other income and expenses: | |||
Interest income | 67 | 3 | 2 |
Interest expense | (30,523) | (23,159) | (21,289) |
Debt restructuring costs | (19,992) | (192) | (468) |
Income (loss) before taxes and loss on sale of real estate | (8,321) | 14,709 | 14,228 |
Tax benefit of taxable REIT subsidiaries | 9,778 | 9,976 | 10,065 |
Loss on sale of real estate | (164) | ||
Net income | 1,457 | 24,685 | 24,129 |
Net income attributable to noncontrolling interests | (175) | (3,160) | (3,803) |
Net income attributable to QTS Realty Trust, Inc. | $ 1,282 | $ 21,525 | $ 20,326 |
Net income per share attributable to common shares: | |||
Basic (in dollars per share) | $ 0.01 | $ 0.47 | $ 0.54 |
Diluted (in dollars per share) | $ 0.01 | $ 0.46 | $ 0.53 |
Weighted average common shares outstanding: | |||
Basic (in shares) | 48,380,964 | 46,205,937 | 37,568,109 |
Diluted (in shares) | 55,855,683 | 53,962,234 | 45,353,170 |
Qualitytech, LP | |||
Revenues: | |||
Rental | $ 335,819 | $ 295,723 | $ 230,510 |
Recoveries from customers | 37,886 | 29,271 | 22,581 |
Cloud and managed services | 65,466 | 68,488 | 51,994 |
Other | 7,339 | 8,881 | 5,998 |
Total revenues | 446,510 | 402,363 | 311,083 |
Operating Expenses: | |||
Property operating costs | 153,209 | 136,488 | 104,355 |
Real estate taxes and insurance | 11,959 | 8,840 | 5,869 |
Depreciation and amortization | 140,924 | 124,786 | 85,811 |
General and administrative | 87,231 | 83,286 | 67,783 |
Transaction, integration and impairment costs | 11,060 | 10,906 | 11,282 |
Total operating expenses | 404,383 | 364,306 | 275,100 |
Operating income | 42,127 | 38,057 | 35,983 |
Other income and expenses: | |||
Interest income | 67 | 3 | 2 |
Interest expense | (30,523) | (23,159) | (21,289) |
Debt restructuring costs | (19,992) | (192) | (468) |
Income (loss) before taxes and loss on sale of real estate | (8,321) | 14,709 | 14,228 |
Tax benefit of taxable REIT subsidiaries | 9,778 | 9,976 | 10,065 |
Loss on sale of real estate | (164) | ||
Net income | $ 1,457 | $ 24,685 | $ 24,129 |
CONSOLIDATED FINANCIAL STATEME5
CONSOLIDATED FINANCIAL STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Net income | $ 1,457 | $ 24,685 | $ 24,129 |
Other comprehensive income: | |||
Increase in fair value of interest rate swaps | 1,449 | ||
Comprehensive income | 2,906 | 24,685 | 24,129 |
Comprehensive income attributable to noncontrolling interests | (349) | (3,160) | (3,803) |
Comprehensive income attributable to QTS Realty Trust, Inc. | 2,557 | 21,525 | 20,326 |
Qualitytech, LP | |||
Net income | 1,457 | 24,685 | 24,129 |
Other comprehensive income: | |||
Increase in fair value of interest rate swaps | 1,449 | ||
Comprehensive income | $ 2,906 | $ 24,685 | $ 24,129 |
CONSOLIDATED FINANCIAL STATEME6
CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED STATEMENT OF EQUITY - USD ($) $ in Thousands | Qualitytech, LPAccumulated Other Comprehensive Income (Loss) | Qualitytech, LPGeneral Partner | Qualitytech, LPLimited Partner | Qualitytech, LP | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Dividends in Excess of Earnings | Total stockholders' Equity | Noncontrolling Interest | Total |
Beginning balance at Dec. 31, 2014 | $ 294 | $ 324,917 | $ (22,503) | $ 302,708 | $ 77,477 | $ 380,185 | |||||
Beginning balance at Dec. 31, 2014 | $ 380,185 | ||||||||||
Partners' Capital, Beginning Balance at Dec. 31, 2014 | $ 380,185 | ||||||||||
Beginning balance, shares at Dec. 31, 2014 | 29,408 | ||||||||||
Beginning balance, shares at Dec. 31, 2014 | 1,000 | 36,935,000 | |||||||||
Issuance of shares through equity award plan | $ (644) | (644) | $ 3 | (3) | (644) | (644) | |||||
Issuance of shares through equity award plan, shares | 338,000 | 338 | |||||||||
Reclassification of noncontrolling interest upon conversion of partnership units to common stock | $ 7 | 9,239 | 9,246 | (9,246) | |||||||
Reclassification of noncontrolling interest upon conversion of partnership units to common stock, shares | 730 | ||||||||||
Equity-based compensation expense | $ 6,964 | 6,964 | 5,866 | 5,866 | 1,098 | 6,964 | |||||
Net proceeds from equity offering | $ 368,664 | 368,664 | $ 108 | 330,256 | 330,364 | 38,300 | 368,664 | ||||
Shares issued | 10,750,000 | 10,750 | |||||||||
Dividend to shareholders | $ (50,555) | (50,555) | (50,555) | (50,555) | (50,555) | ||||||
Distributions to noncontrolling interests | (8,877) | (8,877) | |||||||||
Partnership distributions | (8,877) | (8,877) | |||||||||
Net income | 24,129 | 24,129 | 20,326 | 20,326 | 3,803 | 24,129 | |||||
Ending balance at Dec. 31, 2015 | $ 412 | 670,275 | (52,732) | 617,955 | 101,911 | 719,866 | |||||
Ending balance at Dec. 31, 2015 | $ 719,866 | ||||||||||
Partners' Capital, Ending Balance at Dec. 31, 2015 | 719,866 | ||||||||||
Ending balance, shares at Dec. 31, 2015 | 41,226 | ||||||||||
Ending balance, shares at Dec. 31, 2015 | 1,000 | 48,023,000 | |||||||||
Net share activity through equity award plan | $ 3 | (3) | (1,726) | (1,726) | |||||||
Net share activity through equity award plan, shares | 280 | ||||||||||
Issuance of shares through equity award plan | $ (1,726) | (1,726) | |||||||||
Issuance of shares through equity award plan, shares | 280,000 | ||||||||||
Equity-based compensation expense | $ 10,584 | 10,584 | 9,229 | 9,229 | 1,355 | 10,584 | |||||
Net proceeds from equity offering | $ 275,862 | 275,862 | $ 63 | 252,282 | 252,345 | 23,517 | 275,862 | ||||
Shares issued | 6,325,000 | 6,325 | |||||||||
Dividend to shareholders | $ (66,586) | (66,586) | (66,586) | (66,586) | (66,586) | ||||||
Distributions to noncontrolling interests | (9,875) | (9,875) | |||||||||
Partnership distributions | (9,875) | (9,875) | |||||||||
Net income | 24,685 | 24,685 | 21,525 | 21,525 | 3,160 | 24,685 | |||||
Ending balance at Dec. 31, 2016 | $ 478 | 931,783 | (97,793) | 834,468 | 118,342 | 952,810 | |||||
Ending balance at Dec. 31, 2016 | 952,810 | ||||||||||
Partners' Capital, Ending Balance at Dec. 31, 2016 | $ 952,810 | 952,810 | |||||||||
Ending balance, shares at Dec. 31, 2016 | 47,831 | ||||||||||
Ending balance, shares at Dec. 31, 2016 | 1,000 | 54,628,000 | |||||||||
Net share activity through equity award plan | $ 6 | 893 | 899 | 123 | 1,022 | ||||||
Increase in fair value of interest rate swaps | $ 1,449 | 1,449 | $ 1,283 | 1,283 | 166 | 1,449 | |||||
Issuance of shares through equity award plan | $ 1,022 | 1,022 | |||||||||
Issuance of shares through equity award plan, shares | 582,000 | 582 | |||||||||
Reclassification of noncontrolling interest upon conversion of partnership units to common stock | $ 3 | 8,352 | 8,355 | (8,355) | |||||||
Reclassification of noncontrolling interest upon conversion of partnership units to common stock, shares | 253 | ||||||||||
Equity-based compensation expense | $ 13,863 | 13,863 | 12,196 | 12,196 | 1,667 | 13,863 | |||||
Net proceeds from equity offering | $ 107,495 | 107,495 | $ 20 | 95,952 | 95,972 | 11,523 | 107,495 | ||||
Shares issued | 2,036,000 | 2,036 | |||||||||
Dividend to shareholders | $ (77,041) | (77,041) | (77,041) | (77,041) | (77,041) | ||||||
Distributions to noncontrolling interests | (10,399) | (10,399) | |||||||||
Partnership distributions | (10,399) | (10,399) | |||||||||
Net income | 1,457 | 1,457 | 1,282 | 1,282 | 175 | 1,457 | |||||
Ending balance at Dec. 31, 2017 | $ 507 | $ 1,049,176 | $ 1,283 | $ (173,552) | $ 877,414 | $ 113,242 | $ 990,656 | ||||
Ending balance at Dec. 31, 2017 | 989,207 | ||||||||||
Partners' Capital, Ending Balance at Dec. 31, 2017 | $ 1,449 | $ 989,207 | $ 990,656 | ||||||||
Ending balance, shares at Dec. 31, 2017 | 50,702 | ||||||||||
Ending balance, shares at Dec. 31, 2017 | 1,000 | 57,246,000 |
CONSOLIDATED FINANCIAL STATEME7
CONSOLIDATED FINANCIAL STATEMENTS STATEMENTS OF CASH FLOW - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flow from operating activities: | ||||
Net income (loss) | $ 5,481 | $ 1,457 | $ 24,685 | $ 24,129 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation and amortization | 136,585 | 120,805 | 83,605 | |
Above/Below Market Lease Amortization | 865 | 659 | (117) | |
Amortization of deferred loan costs | 3,640 | 3,285 | 3,181 | |
Amortization of senior notes discount | 229 | 261 | 247 | |
Loss on extinguishment of debt | 19,912 | |||
Equity-based compensation expense | 13,863 | 10,584 | 6,964 | |
Bad debt expense | 3,519 | 1,752 | 1,323 | |
Write off of deferred loan costs | 80 | 224 | 468 | |
Deferred tax benefit | (10,742) | (10,171) | (10,065) | |
Loss on sale of property | (164) | |||
Non-cash transaction, integration and impairment costs | 9,027 | 1,927 | 3,117 | |
Changes in operating assets and liabilities | ||||
Rents and other receivables, net | (12,881) | (17,101) | (1,138) | |
Prepaid expenses | 755 | 158 | (2,182) | |
Other assets | 282 | (561) | (5,016) | |
Accounts payable and accrued liabilities | (5,071) | 6,290 | 9,467 | |
Advance rents, security deposits and other liabilities | 5,491 | 5,959 | (763) | |
Deferred income | 3,312 | 5,038 | (3,597) | |
Net cash provided by operating activities | 170,323 | 153,794 | 109,787 | |
Cash flow from investing activities: | ||||
Proceeds from sale of property | 648 | |||
Acquisitions, net of cash acquired | (127,038) | (173,067) | (292,685) | |
Additions to property and equipment | (307,314) | (279,905) | (320,058) | |
Net cash used in investing activities | (434,352) | (452,972) | (612,095) | |
Cash flow from financing activities: | ||||
Credit facility proceeds | 888,000 | 574,000 | 671,162 | |
Credit facility repayments | (696,000) | (459,002) | (386,998) | |
Debt proceeds | 1,920 | |||
5.75% Senior Notes Repayment | (300,000) | |||
4.75% Notes Issuance | 400,000 | |||
Payment of debt extinguishment costs | (13,218) | |||
Payment of deferred financing costs | (10,862) | (4,177) | (3,649) | |
Payment of cash dividends | (74,592) | (62,585) | (45,892) | |
Distribution to noncontrolling interests | (10,289) | (9,619) | (8,865) | |
Proceeds from exercise of stock options | 4,972 | 858 | 559 | |
Payment of tax withholdings related to equity based awards | (4,725) | (2,584) | (1,088) | |
Principal payments on capital lease obligations | (12,224) | (12,600) | (7,677) | |
Dulles, VA Vault Capital Lease Repayment | (17,785) | |||
Mortgage principal debt repayments | (54) | (86,600) | ||
Equity proceeds, net of costs | 107,549 | 275,663 | 369,372 | |
Net cash provided by financing activities | 262,692 | 299,954 | 500,324 | |
Net (decrease) increase in cash and cash equivalents | (1,337) | 776 | (1,984) | |
Cash and cash equivalents, beginning of period | 9,580 | 8,804 | 10,788 | |
Cash and cash equivalents, end of period | 9,580 | 8,243 | 9,580 | 8,804 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||||
Cash paid for interest (excluding deferred financing costs and amounts capitalized) | 29,934 | 19,897 | 18,027 | |
Noncash investing and financing activities: | ||||
Accrued capital additions | 75,965 | 40,431 | 52,552 | |
Accrued deferred financing costs | 458 | 39 | 1 | |
Accrued equity issuance costs | 25 | 57 | ||
Capital lease and lease financing obligations assumed | 43,832 | |||
Acquisitions, net of cash acquired: | ||||
Land | 7,602 | 9,363 | 7,602 | 3,030 |
Buildings, improvements and equipment | 80,975 | 14,341 | 80,975 | 80,818 |
Construction in Progress | 62,884 | 103,334 | 62,884 | 12,127 |
Rents and other receivables, net | (2,042) | (2,042) | 13,704 | |
Acquired intangibles | 34,521 | 34,521 | 93,400 | |
Deferred costs | 4,414 | 4,414 | ||
Prepaid expenses | 574 | 574 | 1,653 | |
Goodwill | (7,895) | 174,697 | ||
Other assets | 309 | 309 | 633 | |
Capital lease and lease financing obligations | 43,832 | |||
Accounts payable and accrued liabilities | (922) | (922) | (8,586) | |
Advance rents, security deposits and other liabilities | (1,343) | (1,343) | (2,468) | |
Deferred income | 35 | 35 | (10,818) | |
Deferred income taxes | (6,045) | (6,045) | (21,673) | |
Total acquisitions, net of cash acquired | 127,038 | 173,067 | 292,685 | |
Qualitytech, LP | ||||
Cash flow from operating activities: | ||||
Net income (loss) | 5,481 | 1,457 | 24,685 | 24,129 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation and amortization | 136,585 | 120,805 | 83,605 | |
Above/Below Market Lease Amortization | 865 | 659 | (117) | |
Amortization of deferred loan costs | 3,640 | 3,285 | 3,181 | |
Amortization of senior notes discount | 229 | 261 | 247 | |
Loss on extinguishment of debt | 19,912 | |||
Equity-based compensation expense | 13,863 | 10,584 | 6,964 | |
Bad debt expense | 3,519 | 1,752 | 1,323 | |
Write off of deferred loan costs | 80 | 224 | 468 | |
Deferred tax benefit | (10,742) | (10,171) | (10,065) | |
Loss on sale of property | (164) | |||
Non-cash transaction, integration and impairment costs | 9,027 | 1,927 | 3,117 | |
Changes in operating assets and liabilities | ||||
Rents and other receivables, net | (12,881) | (17,101) | (1,138) | |
Prepaid expenses | 755 | 158 | (2,182) | |
Other assets | 282 | (561) | (5,016) | |
Accounts payable and accrued liabilities | (5,071) | 6,290 | 9,467 | |
Advance rents, security deposits and other liabilities | 5,491 | 5,959 | (763) | |
Deferred income | 3,312 | 5,038 | (3,597) | |
Net cash provided by operating activities | 170,323 | 153,794 | 109,787 | |
Cash flow from investing activities: | ||||
Proceeds from sale of property | 648 | |||
Acquisitions, net of cash acquired | (127,038) | (173,067) | (292,685) | |
Additions to property and equipment | (307,314) | (279,905) | (320,058) | |
Net cash used in investing activities | (434,352) | (452,972) | (612,095) | |
Cash flow from financing activities: | ||||
Credit facility proceeds | 888,000 | 574,000 | 671,162 | |
Credit facility repayments | (696,000) | (459,002) | (386,998) | |
Debt proceeds | 1,920 | |||
5.75% Senior Notes Repayment | (300,000) | |||
4.75% Notes Issuance | 400,000 | |||
Payment of debt extinguishment costs | (13,218) | |||
Payment of deferred financing costs | (10,862) | (4,177) | (3,649) | |
Payment of cash dividends | (74,592) | (62,585) | (45,892) | |
Partnership distributions | (10,289) | (9,619) | (8,865) | |
Proceeds from exercise of stock options | 4,972 | 858 | 559 | |
Payment of tax withholdings related to equity based awards | (4,725) | (2,584) | (1,088) | |
Principal payments on capital lease obligations | (12,224) | (12,600) | (7,677) | |
Dulles, VA Vault Capital Lease Repayment | (17,785) | |||
Mortgage principal debt repayments | (54) | (86,600) | ||
Equity proceeds, net of costs | 107,549 | 275,663 | 369,372 | |
Net cash provided by financing activities | 262,692 | 299,954 | 500,324 | |
Net (decrease) increase in cash and cash equivalents | (1,337) | 776 | (1,984) | |
Cash and cash equivalents, beginning of period | 9,580 | 8,804 | 10,788 | |
Cash and cash equivalents, end of period | 9,580 | 8,243 | 9,580 | 8,804 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||||
Cash paid for interest (excluding deferred financing costs and amounts capitalized) | 29,934 | 19,897 | 18,027 | |
Noncash investing and financing activities: | ||||
Accrued capital additions | 75,965 | 40,431 | 52,552 | |
Accrued deferred financing costs | 458 | 39 | 1 | |
Accrued equity issuance costs | 25 | 57 | ||
Capital lease and lease financing obligations assumed | 43,832 | |||
Acquisitions, net of cash acquired: | ||||
Land | 7,602 | 9,363 | 7,602 | 3,030 |
Buildings, improvements and equipment | 80,975 | 14,341 | 80,975 | 80,818 |
Construction in Progress | 62,884 | 103,334 | 62,884 | 12,127 |
Rents and other receivables, net | (2,042) | (2,042) | 13,704 | |
Acquired intangibles | 34,521 | 34,521 | 93,400 | |
Deferred costs | 4,414 | 4,414 | ||
Prepaid expenses | 574 | 574 | 1,653 | |
Goodwill | (7,895) | 174,697 | ||
Other assets | 309 | 309 | 633 | |
Capital lease and lease financing obligations | 43,832 | |||
Accounts payable and accrued liabilities | (922) | (922) | (8,586) | |
Advance rents, security deposits and other liabilities | (1,343) | (1,343) | (2,468) | |
Deferred income | 35 | 35 | (10,818) | |
Deferred income taxes | $ (6,045) | (6,045) | (21,673) | |
Total acquisitions, net of cash acquired | $ 127,038 | $ 173,067 | $ 292,685 |
Description of Business
Description of Business | 12 Months Ended |
Dec. 31, 2017 | |
Description of Business [Abstract] | |
Description of Business | 1. Description of Business QTS Realty Trust, Inc. (“QTS”) through its controlling interest in QualityTech, LP (the “Operating Partnership” and collectively with QTS and their subsidiaries, the “Company”) and the subsidiaries of the Operating Partnership, is engaged in the business of owning, acquiring, constructing, redeveloping and managing multi-tenant data centers. The Company’s portfolio consists of 25 wholly-owned and leased properties with data centers located throughout the United States, Canada, Europe and Asia. QTS was formed as a Maryland corporation on May 17, 2013 and completed its initial public offering of 14,087,500 shares of Class A common stock, $0.01 par value per share (the “IPO”), on October 15, 2013. QTS elected to be taxed as a real estate investment trust (“REIT”), for U.S. federal income tax purposes, commencing with its taxable year ended December 31, 2013. As a REIT, QTS generally is not required to pay federal corporate income taxes on its taxable income to the extent it is currently distributed to its stockholders. The Operating Partnership is a Delaware limited partnership formed on August 5, 2009 and is QTS’ historical predecessor. Concurrently with the completion of the IPO, the Company consummated a series of transactions, including the merger of General Atlantic REIT, Inc. with the Company, pursuant to which it became the sole general partner and majority owner of QualityTech, LP, the Operating Partnership. QTS contributed the net proceeds received from the IPO to the Operating Partnership in exchange for partnership units therein. As of December 31, 2017, QTS owned approximately 88.6% of the interests in the Operating Partnership. Substantially all of QTS’ assets are held by, and QTS’ operations are conducted through, the Operating Partnership. QTS’ interest in the Operating Partnership entitles QTS to share in cash distributions from, and in the profits and losses of, the Operating Partnership in proportion to QTS’ percentage ownership. As the sole general partner of the Operating Partnership, QTS generally has the exclusive power under the partnership agreement of the Operating Partnership to manage and conduct the Operating Partnership’s business and affairs, subject to certain limited approval and voting rights of the limited partners. QTS’ board of directors manages the Company’s business and affairs. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation – The accompanying financial statements have been prepared by management in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The accompanying financial statements are presented for both QTS Realty Trust, Inc. and QualityTech, LP. References to “QTS” mean QTS Realty Trust, Inc. and its controlled subsidiaries; and references to the “Operating Partnership” mean QualityTech, LP and its controlled subsidiaries. In 2016, the Company adopted ASU 2015-02, Amendments to the Consolidation Analysis. This standard amends certain guidance applicable to the consolidation of various legal entities, including variable interest entities (“VIE”). The Company evaluated the application of the ASU and concluded that no change was required to its accounting for its interest in the Operating Partnership. However, under the new guidance, the Operating Partnership now meets the definition and criteria of a VIE and the Company is the primary beneficiary of the VIE. As discussed below, the Company’s only material asset is its ownership interest in the Operating Partnership, and consequently, all of its assets and liabilities represent those assets and liabilities of the Operating Partnership. The Company’s debt is an obligation of the Operating Partnership where the creditors may have recourse, under certain circumstances, against the credit of the Company. QTS is the sole general partner of the Operating Partnership, and its only material asset consists of its ownership interest in the Operating Partnership. Management operates QTS and the Operating Partnership as one business. The management of QTS consists of the same employees as the management of the Operating Partnership. QTS does not conduct business itself, other than acting as the sole general partner of the Operating Partnership and issuing public equity from time to time. QTS has not issued or guaranteed any indebtedness. Except for net proceeds from public equity issuances by QTS, which are contributed to the Operating Partnership in exchange for units of limited partnership interest of the Operating Partnership, the Operating Partnership generates all remaining capital required by the business through its operations, the direct or indirect incurrence of indebtedness, and the issuance of partnership units. Therefore, as general partner with control of the Operating Partnership, QTS consolidates the Operating Partnership for financial reporting purposes. The Company believes, therefore, that providing one set of notes for the financial statements of QTS and the Operating Partnership provides the following benefits: · enhances investors’ understanding of QTS and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business; · eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the disclosure applies to both QTS and the Operating Partnership; and · creates time and cost efficiencies through the preparation of one set of notes instead of two separate sets of notes. In addition, in light of these combined notes, the Company believes it is important for investors to understand the few differences between QTS and the Operating Partnership in the context of how QTS and the Operating Partnership operate as a consolidated company. With respect to balance sheets, the presentation of stockholders’ equity and partners’ capital are the main areas of difference between the consolidated balance sheets of QTS and those of the Operating Partnership. On the Operating Partnership’s consolidated balance sheets, partners’ capital includes partnership units that are owned by QTS and other partners. On QTS’ consolidated balance sheets, stockholders’ equity includes common stock, additional paid in capital, accumulated other comprehensive income (loss) and accumulated dividends in excess of earnings. The remaining equity reflected on QTS’s consolidated balance sheet is the portion of net assets that are retained by partners other than QTS, referred to as noncontrolling interests. With respect to statements of operations, the primary difference in QTS' Statements of Operations and Statements of Comprehensive Income is that for net income (loss), QTS retains its proportionate share of the net income (loss) based on its ownership of the Operating Partnership, with the remaining balance being retained by the Operating Partnership. These combined notes refer to actions or holdings as being actions or holdings of “the Company.” Although the Operating Partnership is generally the entity that enters into contracts, holds assets and issues debt, management believes that these general references to “the Company” in this context is appropriate because the business is one enterprise operated through the Operating Partnership. As discussed above, QTS owns no operating assets and has no operations independent of the Operating Partnership and its subsidiaries. Also, the Operating Partnership owns no operating assets and has no operations independent of its subsidiaries. Obligations under the 4.75% Notes due 2025 and the unsecured credit facility, both discussed in Note 5, are fully, unconditionally, and jointly and severally guaranteed by the Operating Partnership’s existing subsidiaries, other than: QTS Finance Corporation, the co-issuer of the 4.75% Notes due 2025. The indenture governing the 4.75% Notes due 2025 restricts the ability of the Operating Partnership to make distributions to QTS, subject to certain exceptions, including distributions required in order for QTS to maintain its status as a real estate investment trust under the Internal Revenue Code of 1986, as amended (the “Code”). The consolidated financial statements of QTS Realty Trust, Inc. include the accounts of QTS Realty Trust, Inc. and its majority owned subsidiaries. This includes the operating results of the Operating Partnership for all periods presented. Use of Estimates – The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the useful lives of fixed assets, allowances for doubtful accounts and deferred tax assets and the valuation of derivatives, real estate assets, acquired intangible assets and certain accruals. Principles of Consolidation – The consolidated financial statements of QTS Realty Trust, Inc. include the accounts of QTS Realty Trust, Inc. and its majority-owned subsidiaries. The consolidated financial statements of QualityTech, LP include the accounts of QualityTech, LP and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in the financial statements. Reclassifications – The consolidated statement of cash flows for the year ended December 31, 2016 reflects a cash inflow reclassification of $0.9 million from “Payment of tax withholdings related to equity based awards” to “Proceeds from exercise of stock options.” The consolidated statement of cash flows for the year ended December 31, 2015 reflects a cash inflow reclassification of $0.6 million from “Accounts payable and accrued liabilities” to “Proceeds from exercise of stock options” as well as a cash outflow reclassification of $1.1 million from “Accounts payable and accrued liabilities” to “Payment of tax withholdings related to equity based awards.” Both 2016 and 2015 reclassifications were made in accordance with the Company’s adoption of ASU 2016-09, Improvements to Employee Share-Based Payment Accounting as of January 1, 2017 with retrospective application of this provision. Real Estate Assets – Real estate assets are reported at cost. All capital improvements for the income-producing properties that extend their useful lives are capitalized to individual property improvements and depreciated over their estimated useful lives. Depreciation for real estate assets is generally provided on a straight-line basis over 40 years from the date the property was placed in service. Property improvements are depreciated on a straight-line basis over the life of the respective improvement ranging from 20 to 40 years from the date the components were placed in service. Leasehold improvements are depreciated over the lesser of 20 years or through the end of the respective life of the lease. Repairs and maintenance costs are expensed as incurred. For the year ended December 31, 2017, depreciation expense related to real estate assets and non-real estate assets was $90.1 million and $14.2 million, respectively, for a total of $104.3 million. For the year ended December 31, 2016, depreciation expense related to real estate assets and non-real estate assets was $77.5 million and $13.1 million, respectively, for a total of $90.6 million. For the year ended December 31, 2015, depreciation expense related to real estate assets and non-real estate assets was $55.2 million and $9.8 million, respectively, for a total of $65.0 million. The Company capitalizes certain development costs, including internal costs incurred in connection with development. The capitalization of costs during the construction period (including interest and related loan fees, property taxes and other direct and indirect costs) begins when development efforts commence and ends when the asset is ready for its intended use. Capitalization of such costs, excluding interest, aggregated to $12.7 million, $11.0 million and $10.8 million for the years ended December 31, 2017, 2016 and 2015 respectively. Interest is capitalized during the period of development by first applying the Company’s actual borrowing rate on the related asset and second, to the extent necessary, by applying the Company’s weighted average effective borrowing rate to the actual development and other costs expended during the construction period. Interest is capitalized until the property is ready for its intended use. Interest costs capitalized totaled $14.3 million, $11.4 million and $9.8 million for the years ended December 31, 2017, 2016 and 2015, respectively. Acquisitions – Acquisitions of real estate and other entities are either accounted for as asset acquisitions or business combinations depending on facts and circumstances. Purchase accounting is applied to the assets and liabilities related to all real estate investments acquired in accordance with the accounting requirements of ASC 805, Business Combinations , which requires the recording of net assets of acquired businesses at fair value. The fair value of the consideration transferred is allocated to the acquired tangible assets, consisting primarily of land, construction in progress, building and improvements, and identified intangible assets and liabilities, consisting of the value of above-market and below-market leases, value of in-place leases, value of customer relationships, trade names, software intangibles and capital leases. The excess of the fair value of liabilities assumed, common stock issued and cash paid over the fair value of identifiable assets acquired is allocated to goodwill, which is not amortized by the Company. In developing estimates of fair value of acquired assets and assumed liabilities, management analyzed a variety of factors including market data, estimated future cash flows of the acquired operations, industry growth rates, current replacement cost for fixed assets and market rate assumptions for contractual obligations. Such a valuation requires management to make significant estimates and assumptions, particularly with respect to the intangible assets. Acquired in-place leases are amortized as amortization expense on a straight-line basis over the remaining life of the underlying leases. This amortization expense is accounted for as real estate amortization expense. Acquired customer relationships are amortized as amortization expense on a straight-line basis over the expected life of the customer relationship. This amortization expense is accounted for as real estate amortization expense. Other acquired intangible assets, which includes platform, above or below market leases, and trade name intangibles, are amortized on a straight-line basis over their respective expected lives. Above or below market leases are amortized as a reduction to or increase in rental revenue when the Company is a lessor as well as a reduction or increase to rent expense over the remaining lease terms in the case of the Company as lessee. The expense associated with above and below market leases and trade name intangibles is accounted for as real estate expense, whereas the expense associated with the amortization of platform intangibles is accounted for as non-real estate expense. See Note 3 for discussion of the final purchase price allocation for the Piscataway, New Jersey facility (the “Piscataway facility”) that the Company acquired on June 6, 2016, as well as the final purchase price allocation for the Fort Worth, Texas facility (the “Fort Worth facility”) that the Company acquired on December 16, 2016. Impairment of Long-Lived Assets, Intangible Assets and Goodwill – The Company reviews its long-lived assets and intangible assets for impairment when events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Recoverability of assets to be held and used is measured by comparison of the carrying amount to the future net cash flows, undiscounted and without interest, expected to be generated by the asset group. If the net carrying value of the asset exceeds the value of the undiscounted cash flows, the fair value of the asset is assessed and may be considered impaired. An impairment loss is recognized based on the excess of the carrying amount of the impaired asset over its fair value. For the year ended December 31, 2017, the Company recognized a $1.6 million impairment related to equipment used to support its cloud and managed service platform. The impairment charge is included in the “Transaction, integration and impairment costs” line item of the consolidated statement of operations. No impairment losses were recorded for the years ended December 31, 2016 and 2015 . The fair value of goodwill is the consideration transferred which is not allocable to identifiable intangible and tangible assets. Goodwill is subject to at least an annual assessment for impairment. In connection with the goodwill impairment evaluation that the Company performed on October 1, 2017, the Company determined qualitatively that it is not more likely than not that the fair value of the Company’s one reporting unit was less than the carrying amount, thus it did not perform a quantitative analysis. Cash and Cash Equivalents – The Company considers all demand deposits and money market accounts purchased with a maturity date of three months or less at the date of purchase to be cash equivalents. The Company’s account balances at one or more institutions periodically exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and, as a result, there is concentration of credit risk related to amounts on deposit in excess of FDIC coverage. The Company mitigates this risk by depositing a majority of its funds with several major financial institutions. The Company also has not experienced any losses and, therefore, does not believe that the risk is significant. Deferred Costs – Deferred costs, net, on the Company’s balance sheets include both financing costs and leasing costs. Deferred financing costs represent fees and other costs incurred in connection with obtaining debt and are amortized over the term of the loan and are included in interest expense. Debt issuance costs related to revolving debt arrangements are deferred and presented as assets on the balance sheet; however, all other debt issuance costs are recorded as a direct offset to the associated liability. Amortization of debt issuance costs, including those costs presented as offsets to the associated liability in the consolidated balance sheet, were $3.6 million, $3.3 million and $3.2 million for the years ended December 31, 2017, 2016 and 2015, respectively. During the year ended December 31, 2017, the Company wrote off unamortized financing costs of $5.2 million to the income statement primarily in connection with the replacement of its $300 million 5.875% senior notes with the $400 million of 4.75% notes. During the year ended December 31, 2016, the Company wrote off unamortized financing costs of $0.2 million to the income statement in connection with the modification of its unsecured credit facility in December 2016 whereby the company increased the total capacity and extended the term for an additional year. During the year ended December 31, 2015, the Company wrote off unamortized financing costs of $0.5 million to the income statement in connection with the repayment of the Atlanta Metro equipment loan in June 2015 as well as the amendment of its unsecured credit facility in October 2015 whereby the Company increased the unsecured credit facility capacity, and, at the same time, terminated its Richmond credit facility. Deferred financing costs presented as assets on the balance sheet related to revolving debt arrangements, net of accumulated amortization are as follows: December 31, December 31, (dollars in thousands) 2017 2016 Deferred financing costs $ 9,775 $ 7,128 Accumulated amortization (1,908) (145) Deferred financing costs, net $ 7,867 $ 6,983 Deferred financing costs presented as offsets to the associated liabilities on the balance sheet related to fixed debt arrangements, net of accumulated amortization, are as follows: December 31, December 31, (dollars in thousands) 2017 2016 Deferred financing costs $ 12,675 $ 12,779 Accumulated amortization (1,039) (2,660) Deferred financing costs, net $ 11,636 $ 10,119 Deferred leasing costs consist of external fees and internal costs incurred in the successful negotiations of leases and are deferred and amortized over the terms of the related leases on a straight-line basis. If an applicable lease terminates prior to the expiration of its initial term, the carrying amount of the costs are written off to amortization expense. Amortization of deferred leasing costs totaled $18.5 million, $15.2 million and $11.8 million for the years ended December 31, 2017, 2016 and 2015, respectively. Deferred leasing costs, net of accumulated amortization are as follows: December 31, December 31, (dollars in thousands) 2017 2016 Deferred leasing costs $ 54,868 $ 50,026 Accumulated amortization (20,956) (18,502) Deferred leasing costs, net $ 33,912 $ 31,524 Advance Rents and Security Deposits – Advance rents, typically prepayment of the following month’s rent, consist of payments received from customers prior to the time they are earned and are recognized as revenue in subsequent periods when earned. Security deposits are collected from customers at the lease origination and are generally refunded to customers upon lease expiration. Deferred Income – Deferred income generally results from non-refundable charges paid by the customer at lease inception to prepare their space for occupancy. The Company records this initial payment, commonly referred to as set-up fees, as a deferred income liability which amortizes into rental revenue over the term of the related lease on a straight-line basis. Deferred income was $25.3 million, $22.0 million and $17.0 million as of December 31, 2017, 2016 and 2015, respectively. Additionally, $10.7 million, $9.4 million and $6.0 million of deferred income was amortized into revenue for the years ended December 31, 2017, 2016 and 2015, respectively. Equity-based Compensation – All equity-based compensation is measured at fair value on the grant date, and recognized in earnings over the requisite service period. Equity-based compensation costs are measured based upon their estimated fair value on the date of grant or modification and amortized ratably over their respective vesting periods. We have elected to account for forfeitures as they occur. Equity-based compensation expense net of forfeited and repurchased awards was $13.9 million, $10.6 million and $7.0 million for the years ended December 31, 2017, 2016 and 2015, respectively. Rental Revenue – The Company, as a lessor, has retained substantially all of the risks and benefits of ownership and accounts for its leases as operating leases. For lease agreements that provide for scheduled rent increases, rental income is recognized on a straight-line basis over the non-cancellable term of the leases, which commences when control of the space has been provided to the customer. The amount of the straight-line rent receivable on the balance sheets included in rents and other receivables, net was $23.4 million and $17.3 million as of December 31, 2017 and December 31, 2016, respectively. Rental revenue also includes amortization of set-up fees which are amortized over the term of the respective lease as discussed above. Cloud and Managed Services Revenue – The Company may provide both its cloud product and use of its managed services to its customers on an individual or combined basis. Service fee revenue is recognized as the revenue is earned, which generally coincides with the services being provided. Allowance for Uncollectible Accounts Receivable – Rents receivable are recognized when due and are carried at cost, less an allowance for doubtful accounts. The Company records a provision for losses on rents receivable equal to the estimated uncollectible accounts, which is based on management’s historical experience and a review of the current status of the Company’s receivables. As necessary, the Company also establishes an appropriate allowance for doubtful accounts for receivables arising from the straight-lining of rents. The aggregate allowance for doubtful accounts was $11.5 million and $4.2 million as of December 31, 2017 and December 31, 2016, respectively. Capital Leases and Lease Financing Obligations – The Company evaluates leased real estate to determine whether the lease should be classified as a capital or operating lease in accordance with U.S. GAAP. The Company periodically enters into capital leases for certain equipment. In addition, through its acquisition of Carpathia on June 16, 2015, the Company is party to capital leases for property and equipment, as well as certain financing obligations. The outstanding liabilities for the capital leases were $7.8 million and $18.1 million as of December 31, 2017 and 2016, respectively. During the quarter ended December 31, 2017, the Company completed the buyout of the Vault facility in Dulles, VA that was previously subject to a lease financing obligation, therefore the outstanding liabilities for the lease financing obligations were $0.9 million and $20.6 million as of December 31, 2017 and 2016, respectively. The net book value of the assets associated with these leases was approximately $14.7 million and $41.5 million as of December 31, 2017 and 2016, respectively. Depreciation related to the associated assets is included in depreciation and amortization expense in the Statements of Operations. See Note 6 for further discussion of capital leases and lease financing obligations. Recoveries from Customers – Certain customer leases contain provisions under which the customers reimburse the Company for a portion of the property’s real estate taxes, insurance and other operating expenses, which include certain power and cooling-related charges. The reimbursements are included in revenue as recoveries from customers in the Statements of Operations in the period the applicable expenditures are incurred. Certain customer leases are structured to provide a fixed monthly billing amount that includes an estimate of various operating expenses, with all revenue from such leases included in rental revenues. Segment Information – The Company manages its business as one operating segment and thus one reportable segment consisting of a portfolio of investments in data centers located primarily in the United States. Customer Concentrations – As of December 31, 2017, one of the Company’s customers represented 11.8% of its total monthly rental revenue. No other customers exceeded 4.5% of total monthly rental revenue. As of December 31, 2017, five of the Company’s customers exceeded 5% of total accounts receivable. In aggregate, these five customers accounted for 33% of total accounts receivable. None these five customers individually exceeded 10% of total accounts receivable. Income Taxes – The Company has elected for two of its existing subsidiaries to be taxed as taxable REIT subsidiaries pursuant to the REIT rules of the U.S. Internal Revenue Code. For the taxable REIT subsidiaries, income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The components of income tax provision from continuing operations are: For the Year Ended December 31, 2017 2016 2015 Current: U.S. federal $ 42 $ (356) $ 462 U.S. State 297 20 11 Outside United States 44 33 — Total Current 383 (303) 473 Deferred: U.S. federal (9,734) (8,796) (8,952) U.S. State (427) (877) (1,586) Outside United States — — — Total Deferred (10,161) (9,673) (10,538) Total $ (9,778) $ (9,976) $ (10,065) As of December 31, 2014, one of the Company’s taxable REIT subsidiaries’ deferred tax assets were primarily the result of U.S. net operating loss carryforwards. A valuation allowance was recorded against its gross deferred tax asset balance as of December 31, 2014. As a result of the acquisition of Carpathia, the Company determined that it is more likely than not that pre-existing deferred tax assets would be realized by the Company, and the valuation allowance was eliminated. The change in the valuation allowance resulting from the change in circumstances was included in income, and recognized as a deferred income tax benefit in the year ended December 31, 2015. In addition to the deferred income tax benefit recognized in the year ended December 31, 2015 in connection with the elimination of the valuation allowance, a deferred tax benefit was recognized in the years ended December 31, 2017 and 2016 in connection with recorded operating losses. As of December 31, 2015, 2016 and 2017, this taxable REIT subsidiary has a net deferred tax liability position primarily due to customer-based intangibles acquired as part of the Carpathia acquisition. Temporary differences and carry forwards which give rise to the deferred tax assets and liabilities are as follows: For the Year Ended December 31, 2017 2016 2015 Deferred tax liabilities Property and equipment $ (4,940) $ (15,031) $ (16,032) Goodwill (1,396) (1,290) (407) Intangibles (13,606) (24,244) (23,896) Other (1,132) (1,386) (2,350) Gross deferred tax liabilities (21,074) (41,951) (42,685) Deferred tax assets Net operating loss carryforwards 8,888 18,035 14,500 Deferred revenue and setup charges 3,435 4,323 3,747 Leases 453 2,154 3,097 Credits 543 492 630 Bad debt reserve 2,250 41 539 Other 1,607 2,114 1,752 Gross deferred tax assets 17,176 27,159 24,265 Net deferred tax liability (3,898) (14,792) (18,420) Valuation allowance (713) (393) (393) Net deferred tax liability $ (4,611) $ (15,185) $ (18,813) The taxable REIT subsidiaries currently have $33.9 million of net operating loss carryforwards related to federal income taxes that expire in 12-20 years. The taxable REIT subsidiaries also have $35.8 million of net operating loss carryforwards relating to state income taxes that expire in 2-20 years. The effective tax rate is subject to change in the future due to various factors such as the operating performance of the taxable REIT subsidiaries, tax law changes and future business acquisitions. The Company’s effective tax rates were 65.1%, 46.5% and 34.8% for the years ended December 31, 2017, 2016 and 2015, respectively. The effective tax rate increase from 2016 to 2017 is primarily due to the federal rate change resulting from the enactment of the Tax Cuts and Jobs Act and state tax rate changes, offset by a comparative decrease in permanent differences and by the accounting for a valuation allowance. The differences between total income tax expense or benefit and the amount computed by applying the statutory income tax rate to income before provision for income taxes with respect to the TRS activity were as follows: For the Year Ended December 31, 2017 2016 2015 TRS Statutory rate of 34% applied to pre-tax loss $ (5,109) $ (7,299) $ (6,683) Permanent differences, net (284) (2,021) 281 State income tax, net of federal benefit (388) (689) (268) Foreign income tax 44 33 — Federal and State rate change (3,251) — — Contribution of Assets to TRS (866) — — Other (244) — — Valuation allowance (decrease) increase 320 — (3,395) Total tax benefit $ (9,778) $ (9,976) $ (10,065) Effective tax rate On December 22, 2017, the Tax Cuts and Jobs Act ("The Act"), was signed into law by President Trump. The tax legislation contains several provisions, including the lowering of the U.S. corporate tax rate from 35 percent to 21 percent, effective January 1, 2018. The Company has significant deferred tax liabilities, primarily related to fixed assets and intangibles, on its balance sheet as of December 31, 2017. The value of the net deferred tax liabilities has decreased significantly as a result of the reduction in the U.S. corporate income tax rate. Consequently, operating results reflect a one-time non-cash income tax benefit of $3.3 million to reflect the re-measurement of deferred tax assets (liabilities). The Act also repealed corporate alternative minimum tax (“AMT”) for tax years beginning January 1, 2018, and provides that existing AMT credit carryforwards are refundable beginning in 2018. The Company has approximately $0.3 million of AMT credit carryovers that are expected to be fully refunded by 2022. The repeal of AMT does not result in any one-time income tax expense (benefit) to operating results. The Company is following the guidance in SEC Staff Accounting Bulletin 118 (“SAB 118”), which provides additional clarification regarding the application of ASC Topic 740 in situations where the Company may not have the necessary information available, prepared, or analyzed in reasonable detail to complete the accounting for certain income tax effects of the Act for the reporting period in which the Act was enacted. SAB 118 provides for a measurement period beginning in the reporting period that includes the Act’s enactment date and ending when the Company has obtained, prepared, and analyzed the information needed in order to complete the accounting requirements but in no circumstances should the measurement period extend beyond one year from the enactment date. Upon completion of the Company’s 2017 U.S. income tax return in 2018, additional re-measurement adjustments may be identified with respect to the recorded deferred tax assets (liabilities). The Company will continue to assess the provision for income taxes as future guidance is issued, but does not currently anticipate that significant revisions will be necessary. Any such revisions will be treated in accordance with the measurement period guidance outlined in SAB 118. As of December 31, 2017, 2016 and 2015, the Company had no uncertain tax positions. If the Company accrues any interest or penalties on tax liabilities from significant uncertain tax positions, those items will be classified as interest expense and g |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2017 | |
Acquisitions [Abstract] | |
Acquisitions | 3. Acquisitions (All references to square footage, acres and megawatts are unaudited) Fort Worth Acquisition On December 16, 2016, the Company completed the acquisition of the Fort Worth facility for approximately $50.1 million. This facility is located in Fort Worth, Texas, and consists of 53 acres and approximately 262,000 gross square feet. This facility has a basis of design of 80,000 square feet and contains approximately 50 MW of available utility power. This acquisition was funded with a draw on the unsecured revolving credit facility. The Company accounted for this acquisition in accordance with ASC 805, Business Combinations , as a business combination. The Company is valuing the assets acquired and liabilities assumed primarily using Level 3 inputs. In December 2017, the Company finalized the Fort Worth purchase price allocation. The following table summarizes the consideration for the Fort Worth facility and the final allocation of the fair value of assets acquired and liabilities assumed at the acquisition date (in thousands): Final Fort Worth Allocation as of Preliminary Allocation Reported as of December 31, 2016 Adjustments to Fair Value Land $ 136 $ 136 $ — Buildings and improvements 610 610 — Construction in progress 48,987 48,984 3 Acquired intangibles 237 240 (3) Deferred costs 23 23 — Other assets 7 7 — Net Working Capital 86 86 — Total identifiable assets acquired $ 50,086 $ 50,086 $ — Acquired intangibles are amortized as both amortization expense as well as offsets to rental revenue. No changes were recorded to the preliminary allocation of the fair value of assets acquired and liabilities assumed during the three months ended December 31, 2017. Piscataway Acquisition On June 6, 2016, the Company completed the acquisition of the Piscataway facility. This facility is located in the New York metro area on 38 acres and consists of 360,000 gross square feet, including approximately 89,000 square feet of raised floor, and approximately 18 MW of critical power. The Piscataway facility supports future growth with space for an additional approximately 87,000 square feet of raised floor in the existing structure, as well as capacity for over 8 MW of additional critical power. This acquisition was funded with a draw on the unsecured revolving credit facility. The Company accounted for this acquisition in accordance with ASC 805, Business Combinations , as a business combination. The Company is generally valuing the assets acquired and liabilities assumed using Level 3 inputs. In June 2017, the Company finalized the Piscataway purchase price allocation. The following table summarizes the consideration for the Piscataway facility and the final allocation of the fair value of assets acquired and liabilities assumed at the acquisition date (in thousands): Final Piscataway Allocation as of Preliminary Allocation Reported as of June 30, 2016 Adjustments to Fair Value Land $ 7,466 $ 7,440 $ 26 Buildings and improvements 80,366 78,370 1,996 Construction in progress 13,900 13,900 — Acquired intangibles 19,581 21,668 (2,087) Deferred costs 4,390 4,084 306 Other assets 106 106 — Total identifiable assets acquired 125,809 125,568 241 Acquired below market lease 809 568 241 Net working capital 2,019 2,019 — Total liabilities assumed 2,828 2,587 241 Net identifiable assets acquired $ 122,981 $ 122,981 $ — There were no measurement period adjustments recorded during the 2017 reporting period associated with the Piscataway purchase price allocation. Vault Asset Acquisition On October 6, 2017, the Company completed the buyout of its Vault facility in Dulles, Virginia. The facility consists of approximately 87,000 gross square feet, including approximately 31,000 square feet of raised floor, and approximately 13 MW of available utility power. The Company previously leased the property under a capital lease agreement of approximately $17.8 million and purchased it for approximately $34.1 million cash, for a net purchase price of $16.3 million. This acquisition was funded with a draw on the unsecured revolving credit facility. The Company accounted for this acquisition in accordance with ASC Topic 840, Leases . Land Acquisitions In July 2017, the Company completed the acquisition of approximately 84 acres of land in Phoenix, Arizona for approximately $25 million to be used for future development. In August 2017, the Company completed the acquisition of approximately 24 acres of land in Ashburn, Virginia for approximately $17 million. As of December 31, 2017, the Company has commenced development of a mega data center facility on the acquired land parcel. In October 2017, the Company completed the acquisition of approximately 28 acres of land in Ashburn, Virginia for approximately $36 million to be used for future development. In October 2017, the Company completed the acquisition of approximately 92 acres of land in Hillsboro, Oregon for approximately $26 million to be used for future development. The fair value of the land acquired in each of the four aforementioned acquisitions, as well as costs associated with the subsequent development of the data center in Ashburn, aggregated $163.6 million as of December 31, 2017 and is included within the “Construction in Progress” line item of the consolidated balance sheets. |
Acquired Intangibles Assets and
Acquired Intangibles Assets and Liabilities | 12 Months Ended |
Dec. 31, 2017 | |
Acquired Intangible Assets and Liabilities | |
Acquired Intangibles Assets and Liabilities | 4. Acquired Intangible Assets and Liabilities Summarized below are the carrying values for the major classes of intangible assets and liabilities (in thousands): December 31, 2017 December 31, 2016 Useful Lives Gross Accumulated Net Carrying Gross Accumulated Net Carrying Customer Relationships 1 to 12 years $ 95,705 $ (20,512) $ 75,193 $ 95,705 $ (12,358) $ 83,347 In-Place Leases 0.5 to 10 years 32,066 (12,987) 19,079 32,066 (7,197) 24,869 Solar Power Agreement (1) 17 years 13,747 (2,830) 10,917 13,747 (2,022) 11,725 Platform Intangible 3 years 9,600 (8,133) 1,467 9,600 (4,933) 4,667 Acquired Favorable Leases 0.5 to 8 years 4,649 (2,328) 2,321 4,652 (1,013) 3,639 Tradenames 3 years 3,100 (2,626) 474 3,100 (1,593) 1,507 Total Intangible Assets $ 158,867 $ (49,416) $ 109,451 $ 158,870 $ (29,116) $ 129,754 Solar Power Agreement (1) 17 years 13,747 (2,830) 10,917 13,747 (2,022) 11,725 Acquired Unfavorable Leases Acquired below market leases - as Lessor 3 to 4 years 809 (375) 434 809 (138) 671 Acquired above market leases - as Lessee 11 to 12 years 2,453 (550) 1,903 2,453 (334) 2,119 Total Intangible Liabilities (2) $ 17,009 $ (3,755) $ 13,254 $ 17,009 $ (2,494) $ 14,515 (1) Amortization related to the Solar Power Agreement asset and liability is recorded at the same rate and therefore has no net impact on the statement of operations. (2) Intangible liabilities are included within the “Advance rents, security deposits and other liabilities” line item of the consolidated balance sheets. Above or below market leases are amortized as a reduction to or increase in rental revenue as well as a reduction to rent expense in the case of the Company as lessee over the remaining lease terms. The net effect of amortization of acquired above‑market and below‑market leases resulted in a net decrease in rental revenue of $0.9 million and $0.7 million for the years ended December 31, 2017 and 2016, respectively, as well as a decrease in rental expense of $0.1 million for the year ended December 31, 2015. The estimated amortization of acquired favorable and unfavorable leases for each of the five succeeding fiscal years ending December 31 is as follows (in thousands): Net Rental Revenue Rental Expense 2018 $ 681 $ 216 2019 479 216 2020 647 216 2021 46 216 2022 17 216 Thereafter 17 823 Total $ 1,887 $ 1,903 Net amortization of all other identified intangible assets and liabilities was $18.2 million, $19.0 million and $9.0 million for the years ended December 31, 2017, 2016 and 2015, respectively. The estimated net amortization of all other identified intangible assets and liabilities for each of the five succeeding fiscal years ending December 31 is as follows (in thousands): 2018 $ 14,574 2019 11,965 2020 11,379 2021 10,137 2022 9,910 Thereafter 38,248 Total $ 96,213 |
Real Estate Assets and Construc
Real Estate Assets and Construction in Progress | 12 Months Ended |
Dec. 31, 2017 | |
Real Estate Assets and Construction in Progress [Abstract] | |
Real Estate Assets and Construction in Progress | 5. Real Estate Assets and Construction in Progress The following is a summary of properties owned or leased by the Company as of December 31, 2017 and 2016 (in thousands): As of December 31, 2017: Property Location Land Buildings and Improvements Construction Total Cost Atlanta, Georgia (Atlanta-Metro) $ 20,416 $ 452,836 $ 28,614 $ 501,866 Irving, Texas 8,606 276,894 86,320 371,820 Richmond, Virginia 2,180 254,603 61,888 318,671 Chicago, Illinois 9,400 81,463 135,479 226,342 Suwanee, Georgia (Atlanta-Suwanee) 3,521 165,915 3,620 173,056 Leased Facilities (1) — 59,460 5,534 64,994 Piscataway, New Jersey 7,466 83,251 37,807 128,524 Santa Clara, California (2) — 100,028 6,989 107,017 Sacramento, California 1,481 64,251 58 65,790 Fort Worth, Texas 9,079 17,894 33,774 60,747 Princeton, New Jersey 20,700 32,948 451 54,099 Dulles, Virginia 3,154 76,239 3,565 82,958 Ashburn, Virginia (3) — — 106,952 106,952 Phoenix, Arizona (3) — — 27,402 27,402 Hillsboro, Oregon (3) — — 29,278 29,278 Other (4) 2,213 35,505 88 37,806 $ 88,216 $ 1,701,287 $ 567,819 $ 2,357,322 (1) Includes 11 facilities. All facilities are leased, including those subject to capital leases. During the quarter ended March 31, 2017, the Company moved its Jersey City, NJ facility to the “Leased facilities” line item. During the quarter ended December 31, 2017, the Company completed the buyout of the Vault facility in Dulles, VA that was previously subject to a capital lease agreement, and as such, the facility was moved from the “Leased facilities” line item to a separate “Dulles, Virginia” line item. (2) Owned facility subject to long-term ground sublease. (3) Represent land purchases. Land acquisition costs, as well as subsequent development costs, are included within construction in progress until development on the land has ended and the asset is ready for its intended use. (4) Consists of Miami, FL; Lenexa, KS and Overland Park, KS facilities. During the quarter ended June 30, 2017, fixed assets and the associated accumulated depreciation related to the Duluth, GA facility (comprised of $1.9 million of land, $8.7 million of buildings, improvements, and equipment, and $0.1 million of construction in progress) were moved from Real Estate Assets, net to Other assets, net on the Consolidated Balance Sheet as the facility was transitioned to corporate office space. As of December 31, 2016: Property Location Land Buildings and Construction Total Cost Atlanta, Georgia (Atlanta-Metro) $ 15,397 $ 434,965 $ 32,422 $ 482,784 Irving, Texas 8,606 204,713 69,653 282,972 Richmond, Virginia 2,180 237,347 70,580 310,107 Chicago, Illinois 9,400 45,848 100,623 155,871 Suwanee, Georgia (Atlanta-Suwanee) 3,521 171,376 2,013 176,910 Leased Facilities (1) 1,130 116,290 10,003 127,423 Piscataway, New Jersey 7,466 82,210 17,261 106,937 Santa Clara, California (2) — 98,708 7,078 105,786 Sacramento, California 1,481 62,102 390 63,973 Fort Worth, Texas 136 610 49,116 49,862 Princeton, New Jersey 20,700 32,788 538 54,026 Other (3) 4,113 37,810 6,283 48,206 $ 74,130 $ 1,524,767 $ 365,960 $ 1,964,857 (1) Includes 12 facilities. All facilities are leased, including those subject to capital leases. During the quarter ended March 31, 2017, the Company moved its Jersey City, NJ facility to the “Leased facilities” line item, therefore has conformed December 31, 2016 information to comparable categories. (2) Owned facility subject to long-term ground sublease. (3) Consists of Miami, FL; Lenexa, KS, Overland Park, KS and Duluth, GA facilities. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2017 | |
Debt [Abstract] | |
Debt | 6. Debt Below is a listing of the Company’s outstanding debt, including capital leases and lease financing obligations, as of December 31, 2017 and 2016 (in thousands): Weighted Average Coupon Interest Rate at Maturities as of December 31, December 31, December 31, 2017 December 31, 2017 2017 2016 Unsecured Credit Facility Revolving Credit Facility December 17, 2021 $ 131,000 $ 139,000 Term Loan I December 17, 2022 350,000 300,000 Term Loan II April 27, 2023 350,000 200,000 Senior Notes November 15, 2025 400,000 300,000 Lenexa Mortgage May 1, 2022 1,866 — Capital Lease and Lease Financing Obligations 2018 - 2019 8,699 38,708 1,241,565 977,708 Less discount and net debt issuance costs (11,636) (11,882) Total outstanding debt, net $ 1,229,929 $ 965,826 Credit Facilities, Senior Notes and Mortgage Notes Payable (a) Unsecured Credit Facility – In December 2017, the Company amended its unsecured credit facility, increasing the total capacity to $1.52 billion and extending the term. The unsecured credit facility includes a $350 million term loan which matures on December 17, 2022, a $350 million term loan which matures on April 27, 2023, and a $820 million revolving credit facility which matures on December 17, 2021, with a one year extension option. Amounts outstanding under the amended unsecured credit facility bear interest at a variable rate equal to, at the Company’s election, LIBOR or a base rate, plus a spread that will vary depending upon the Company’s leverage ratio. For revolving credit loans, the spread ranges from 1.55% to 2.15% for LIBOR loans and 0.55% to 1.15% for base rate loans. For term loans, the spread ranges from 1.50% to 2.10% for LIBOR loans and 0.50% to 1.10% for base rate loans. The unsecured credit facility also includes a $400 million accordion feature. Under the unsecured credit facility, the capacity may be increased from the current capacity of $1.52 billion to $1.92 billion subject to certain conditions set forth in the credit agreement, including the consent of the administrative agent and obtaining necessary commitments. The Company is also required to pay a commitment fee to the lenders assessed on the unused portion of the unsecured revolving credit facility. At the Company’s election, it can prepay amounts outstanding under the unsecured credit facility, in whole or in part, without penalty or premium. The Company’s ability to borrow under the amended unsecured credit facility is subject to ongoing compliance with a number of customary affirmative and negative covenants, including limitations on liens, mergers, consolidations, investments, distributions, asset sales and affiliate transactions, as well as the following financial covenants: (i) the Operating Partnership's and its subsidiaries' consolidated total unsecured debt plus any capitalized lease obligations with respect to the unencumbered asset pool properties may not exceed 60% of the unencumbered asset pool value (or 65% of the unencumbered asset pool value for up to two consecutive fiscal quarters immediately following a material acquisition for which the Operating Partnership has provided written notice to the Agent; provided the two fiscal quarter period includes the quarter in which the material acquisition was consummated); (ii) the unencumbered asset pool debt yield cannot be less than 14% (or 12.5% for the two consecutive fiscal quarters immediately following a material acquisition for which the Operating Partnership has provided written notice to the Agent; provided the two fiscal quarter period includes the quarter in which the material acquisition was consummated); (iii) QTS must maintain a minimum fixed charge coverage ratio (defined as the ratio of consolidated EBITDA, subject to certain adjustments, to consolidated fixed charges) for the prior two most recently-ended calendar quarters of 1.70 to 1.00; (iv) QTS must maintain a maximum debt to gross asset value (as defined in the amended and restated agreement) ratio of 60% (or 65% for the two consecutive fiscal quarters immediately following a material acquisition for which the Operating Partnership has provided written notice to the Agent; provided the two fiscal quarter period includes the quarter in which the material acquisition was consummated); (v) QTS must maintain tangible net worth (as defined in the amended and restated agreement) cannot be less than the sum of $1,209,000,000 plus 75% of the net proceeds from any future equity offerings; and (vi) a maximum distribution payout ratio of the greater of (i) 95% of the Company’s Funds from Operations (as defined in the amended and restated agreement) and (ii) the amount required for the Company to qualify as a REIT under the Code. The availability under the revolving credit facility is the lesser of (i) $820 million, (ii) 60% of the unencumbered asset pool capitalized value (or 65% of the unencumbered asset pool capitalized value for the two consecutive fiscal quarters immediately following a material acquisition for which the Operating Partnership has provided written notice to the Agent; provided the two fiscal quarter period includes the quarter in which the material acquisition was consummated) and (iii) the amount resulting in an unencumbered asset pool debt yield of 14% (or 12.5% for the two consecutive fiscal quarters immediately following a material acquisition for which the Operating Partnership has provided written notice to the Agent; provided the two fiscal quarter period includes the quarter in which the material acquisition was consummated). In the case of clauses (ii) and (iii) of the preceding sentence, the amount available under the revolving credit facility is adjusted to take into account any other unsecured debt and certain capitalized leases. A material acquisition is an acquisition of properties or assets with a gross purchase price equal to or in excess of 15% of the Operating Partnership's gross asset value (as defined in the amended and restated agreement) as of the end of the most recently ended quarter for which financial statements are publicly available. The availability of funds under the unsecured credit facility depends on compliance with certain covenants. As of December 31, 2017, the Company had outstanding $831.0 million of indebtedness under the unsecured credit facility, consisting of $131.0 million of outstanding borrowings under the unsecured revolving credit facility and $700.0 million outstanding under the term loans, exclusive of net debt issuance costs of $5.8 million. In connection with the unsecured credit facility, as of December 31, 2017, the Company had additional letters of credit outstanding aggregating to $2.1 million. As of December 31, 2017, the weighted average interest rate for amounts outstanding under the unsecured credit facility was 2.89%. On April 5, 2017, the Company entered into forward interest rate swap agreements with an aggregate notional amount of $400 million. The forward swap agreements effectively fix the interest rate on $400 million of term loan borrowings, $200 million of swaps allocated to each term loan, from January 2, 2018 through December 17, 2021 and April 27, 2022, respectively. The weighted average effective fixed interest rate on the $400 million notional amount of term loan financing, following the execution of these swap agreements, will approximate 3.5%, commencing on January 2, 2018, assuming the current LIBOR spread of 1.5%. (b) Senior Notes – On July 23, 2014, the Operating Partnership and QTS Finance Corporation, a subsidiary of the Operating Partnership formed solely for the purpose of facilitating the offering of the notes described below (collectively, the “Issuers”), issued $300 million aggregate principal amount of 5.875% Senior Notes due 2022 (the “2022 Notes”). The 2022 Notes had an interest rate of 5.875% per annum, were issued at a price equal to 99.211% of their face value and were scheduled to mature on August 1, 2022. On November 8, 2017, the Issuers, the Company and certain of its other subsidiaries entered into a purchase agreement pursuant to which the Issuers issued $400 million aggregate principal amount of 4.75% senior notes due November 15, 2025 (the “Senior Notes”) in a private offering. The Senior Notes have an interest rate of 4.750% per annum and were issued at a price equal to 100% of their face value. The net proceeds from the offering were used to fund the redemption of, and satisfy and discharge the indenture pursuant to which the Issuers issued, all of their outstanding 2022 Notes and to repay a portion of the amount outstanding under the Company’s unsecured revolving credit facility. The Senior Notes are unconditionally guaranteed, jointly and severally, on a senior unsecured basis by all of the Operating Partnership’s existing subsidiaries (other than foreign subsidiaries and receivables entities) and future subsidiaries that guarantee any indebtedness of QTS, the Issuers or any other subsidiary guarantor. QTS Realty Trust, Inc. does not guarantee the Senior Notes and will not be required to guarantee the Senior Notes expect under certain circumstances. The offering was conducted pursuant to Rule 144A of the Securities Act of 1933, as amended, and the Senior Notes were issued pursuant to an indenture, dated as of November 8, 2017, among QTS, the Issuers, the guarantors named therein, and Deutsche Bank Trust Company Americas, as trustee. The Company incurred one-time expenses in the fourth quarter of 2017 associated with the redemption of the 2022 Notes of $19.9 million, including a call premium to redeem the 2022 Notes as well as certain noncash charges related to deferred finance costs and bond discount. As of December 31, 2017, and the outstanding net debt issuance costs associated with the Notes were $5.8 million. The annual remaining principal payment requirements as of December 31, 2017 per the contractual maturities and excluding extension options, capital leases and lease financing obligations, are as follows (in thousands): 2018 $ 65 2019 68 2020 71 2021 131,074 2022 350,077 Thereafter 751,511 Total $ 1,232,866 As of December 31, 2017, the Company was in compliance with all of its covenants. Capital Leases The Company has historically entered into capital leases for certain equipment. In addition, through its acquisition of Carpathia on June 16, 2015, the Company acquired capital leases of both equipment and certain properties. Total outstanding liabilities for capital leases were $7.8 million as of December 31, 2017, of which $5.7 million were assumed through the Carpathia acquisition, all of which was related to the lease of real property. Carpathia had entered into capital lease arrangements for datacenter space under two lease agreements expiring in 2018 and 2019 at its Harrisonburg, Virginia and Ashburn, Virginia locations. Total recurring monthly payments range from approximately $0.2 million to $0.5 million during the terms of the leases, in addition to payments made for utilities. Depreciation related to the associated assets for the capital leases is included in depreciation and amortization expense in the Statements of Operations and Statements of Comprehensive Income. Lease Financing Obligations The Company, through its acquisition of Carpathia, has a lease financing agreement in connection with a $4.8 million tenant improvement allowance on one of its data center lease agreements. The financing requires monthly payments of principal and interest of less than $0.1 million through February 2019. The outstanding balance on the financing agreement was $0.9 million as of December 31, 2017. Depreciation expense on the related leasehold improvements is included in depreciation and amortization expense in the Statements of Operations. Prior to the Company’s acquisition of the Vault facility in Dulles, Virginia in October 2017, the Company had a lease financing obligation through the acquisition of Carpathia related to a sale-leaseback transaction where Carpathia had continuing involvement. This liability was resolved in connection with the acquisition of the Vault Facility in October 2017. On October 6, 2017, the Company completed the buyout of the Vault facility in Dulles, Virginia, which, as mentioned above was previously subject to a lease financing obligation. At the time of purchase the Company’s remaining lease financing obligation inclusive of the deferred gain was approximately $17.8 million and the Company purchased it for approximately $34.1 million cash, for a net purchase price of $16.3 million. The following table summarizes the Company’s combined future payment obligations, excluding interest, as of December 31, 2017, on the capital leases and lease financing obligations described above (in thousands): 2018 $ 7,760 2019 939 2020 - 2021 - 2022 - Thereafter - Total $ 8,699 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 7. Commitments and Contingencies The Company is subject to various routine legal proceedings and other matters in the ordinary course of business. The Company does not currently have any litigation that would have a material adverse impact on the Company’s financial statements. |
Partners' Capital, Equity and I
Partners' Capital, Equity and Incentive Compensation Plans | 12 Months Ended |
Dec. 31, 2017 | |
Partners' Capital, Equity and Incentive Compensation Plans [Abstract] | |
Partners' Capital, Equity and Incentive Compensation Plans | 8. Partners’ Capital, Equity and Incentive Compensation Plans QualityTech, LP QTS has the full power and authority to do all the things necessary to conduct the business of the Operating Partnership. As of December 31, 2017, the Operating Partnership had two classes of limited partnership units outstanding: Class A units of limited partnership interest (“Class A units”) and Class O LTIP units of limited partnership units (“Class O units”). The Class A units are now redeemable at any time for cash or shares of Class A common stock of QTS. The Company may in its sole discretion elect to assume and satisfy the redemption amount with cash or its shares. Class O units were issued upon grants made under the QualityTech, LP 2010 Equity Incentive Plan (the “2010 Equity Incentive Plan”). Class O units are pari passu with Class A units. Each Class O unit is convertible into Class A units by the Operating Partnership at any time or by the holder at any time following full vesting (if such unit is subject to vesting) based on formulas contained in the partnership agreement. QTS Realty Trust, Inc. In connection with its IPO, QTS issued Class A common stock and Class B common stock. Class B common stock entitles the holder to 50 votes per share and was issued to enable the Company’s Chief Executive Officer to exchange 2% of his Operating Partnership units so he may have a vote proportionate to his economic interest in the Company. Also in connection with its IPO, QTS adopted the QTS Realty Trust, Inc. 2013 Equity Incentive plan (the “2013 Equity Incentive Plan”), which authorized 1.75 million shares of Class A common stock to be issued under the plan, including options to purchase Class A common stock, restricted Class A common stock, Class O units, and Class RS LTIP units of limited partnership interest. In May 2015, the total number of shares available for issuance under the 2013 Equity Incentive Plan was increased to 4,750,000. The following is a summary of award activity under the 2010 Equity Incentive Plan and 2013 Equity Incentive Plan and related information for the years ended December 31, 2017, 2016 and 2015: 2010 Equity Incentive Plan 2013 Equity Incentive Plan Weighted Weighted Weighted Weighted Weighted average Weighted average average Number of average Average fair Number of Grant date average fair Restricted Grant date Class O units exercise price value Class RS units value Options exercise price value Stock value Outstanding at January 1, 2015 1,518,717 $ 23.49 $ 3.75 74,625 $ 23.49 584,949 $ 22.87 $ 4.10 246,785 $ 29.13 Granted — — — — — 317,497 36.16 8.03 230,271 36.71 Exercised/Vested (1) (222,499) 22.02 4.18 — — (23,157) 21.30 3.63 (54,400) 28.37 Released from restriction (2) — — — (34,750) 25.00 — — — — — Cancelled/Expired (3) (3,319) 20.00 3.92 — — (11,407) 21.00 3.52 (27,748) 28.33 Outstanding at December 31, 2015 1,292,899 $ 23.76 $ 3.68 39,875 $ 22.18 867,882 $ 27.80 $ 5.56 394,908 $ 33.82 Granted — — — — — 229,693 45.78 9.91 237,563 45.53 Exercised/Vested (1) (158,088) 21.56 4.18 — — (29,543) 25.70 4.96 (122,136) 33.26 Released from restriction (2) — — — (39,875) 22.18 — — — — — Cancelled/Expired (3) — — — — — (9,735) 32.14 6.95 (95,644) 33.92 Outstanding at December 31, 2016 1,134,811 $ 24.06 $ 3.62 — $ — 1,058,297 $ 31.72 $ 6.51 414,691 $ 40.67 Granted — — — — — 468,875 50.66 10.32 228,576 49.86 Exercised/Vested (1) (566,771) 24.60 2.24 — — (155,902) 31.89 6.60 (163,048) 40.63 Cancelled/Expired (3) — — — — — (2,000) 37.69 8.77 (98,355) 39.97 Outstanding at December 31, 2017 568,040 $ 23.52 $ 5.00 — $ — 1,369,270 $ 38.18 $ 7.80 381,864 $ 46.37 (1) This represents the Class A common stock that has been released from restriction and which was not surrendered by the holder to satisfy their statutory minimum federal and state tax obligations associated with the vesting of restricted common stock. This also represents Class O units which were converted to Class A units and Options to purchase Class A common stock which were exercised for their respective columns. (2) This represents Class RS units that upon vesting have converted to Operating Partnership units. (3) Includes restricted Class A common stock surrendered by certain employees to satisfy their statutory minimum federal and state tax obligations associated with the vesting of restricted common stock. The assumptions and fair values for restricted stock and options to purchase shares of Class A common stock granted for the years ended December 31, 2017, 2016 and 2015 are included in the following table on a per unit basis. Options to purchase shares of Class A common stock were valued using the Black-Scholes model. 2017 2016 2015 Fair value of restricted stock granted $48.63 - $51.88 $45.78 - $56.28 $35.81 - $37.69 Fair value of options granted $10.11 - $10.36 $9.57 - $9.97 $8.00 - $8.77 Expected term (years) 5.5 - 5.9 5.5 - 5.9 5.5 - 6.1 Expected volatility 30.7% - 31.3% Expected dividend yield 3.40% - 3.57% Expected risk-free interest rates 2.12% - 2.18% 1.42% - 1.48% 1.67% - 1.94% The following tables summarize information about awards outstanding as of December 31, 2017. Operating Partnership Awards Outstanding Weighted average Awards remaining Exercise prices outstanding vesting period (years) Class O Units $ 20.00 - 25.00 568,040 — Total Operating Partnership awards outstanding 568,040 QTS Realty Trust, Inc. Awards Outstanding Weighted average Awards remaining Exercise prices outstanding vesting period (years) Restricted stock $ — 381,864 1.7 Options to purchase Class A common stock $ 21.00 - 50.66 1,369,270 0.8 Total QTS Realty Trust, Inc. awards outstanding 1,751,134 As of December 31, 2017, there were no Class RS units outstanding. Any remaining nonvested awards are valued as of the grant date and generally vest ratably over a defined service period. As of December 31, 2017 there were approximately 0.4 million and 0.6 million nonvested restricted Class A common stock and options to purchase Class A common stock outstanding, respectively. As of December 31, 2017 the Company had $18.1 million of unrecognized equity-based compensation expense which will be recognized over a remaining weighted-average vesting period of approximately 1 year. The total intrinsic value of the awards outstanding at December 31, 2017 was $59.6 million. Dividends and Distributions The following tables present quarterly cash dividends and distributions paid to QTS’ common stockholders and the Operating Partnership’s unit holders for the years ended December 31, 2017 and 2016: Year Ended December 31, 2017 Aggregate Per Common Share and Dividend/Distribution Record Date Payment Date Per Unit Rate Amount (in millions) September 22, 2017 October 5, 2017 $ 0.39 $ 22.2 June 16, 2017 July 6, 2017 0.39 21.6 March 16, 2017 April 5, 2017 0.39 21.4 December 16, 2016 January 5, 2017 0.36 19.7 $ 1.53 $ 84.9 Year Ended December 31, 2016 Aggregate Per Common Share and Dividend/Distribution Record Date Payment Date Per Unit Rate Amount (in millions) September 20, 2016 October 5, 2016 $ 0.36 $ 19.7 June 17, 2016 July 6, 2016 0.36 19.7 March 18, 2016 April 5, 2016 0.36 17.4 December 17, 2015 January 6, 2016 0.32 15.4 $ 1.40 $ 72.2 Additionally, on January 5, 2018, the Company paid its regular quarterly cash dividend of $0.39 per common share and per unit in the Operating Partnership to stockholders and unit holders of record as of the close of business on December 5, 2017. Equity Issuances In March 2017, the Company established an “at-the-market” equity offering program (the “ATM Program”) pursuant to which the Company may issue, from time to time, up to $300 million of its Class A common stock. During the year ended December 31, 2017, the Company issued 2,036,121 shares of QTS’ Class A common stock under the ATM Program at a weighted average price of $53.88 per share which generated net proceeds of approximately $108.1 million. QTS Realty Trust, Inc. Employee Stock Purchase Plan In June 2015, the Company established the QTS Realty Trust, Inc. Employee Stock Purchase Plan (the “2015 Plan”) to give eligible employees the opportunity to purchase, through payroll deductions, shares of the Company’s Class A common stock in the open market by an independent broker with the Company paying brokerage commissions and fees associated with such share purchases. The 2015 Plan became effective July 1, 2015. The Company reserved 250,000 shares of its Class A common stock for purchase under the 2015 Plan, which were registered pursuant to a registration statement on Form S-8 filed on June 17, 2015. On May 4, 2017, the stockholders of the Company approved an amendment and restatement of the Plan (the “2017 Plan”). The 2017 Plan became effective July 1, 2017 and is administered by the Compensation Committee of the board of directors (or by a committee of one or more persons appointed by it or the board of directors). The 2017 Plan permits participants to purchase the Company’s Class A common stock at a discount of up to 10% (as determined by the Compensation Committee). Employees of the Company and its majority-owned subsidiaries who have been employed for at least thirty days and who perform at least thirty hours of service per week for the Company are eligible to participate in the 2017 Plan, excluding any employee who, at any time during which the payroll deductions are made on behalf of participating employees to purchase stocks, owns shares representing five percent or more of the total combined voting power or value of all classes of shares of the Company, or who is a Section 16 officer. Under the 2017 Plan, there are four purchase periods per year, and participants may deduct a minimum of $20 per paycheck and a maximum of $1,000 per paycheck towards the purchase of shares. Shares purchased under the 2017 Plan are subject to a one-year holding period following the purchase date, during which they may not be sold or transferred. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 9. Related Party Transactions The Company periodically executes transactions with entities affiliated with its Chairman and Chief Executive Officer. Such transactions include automobile, furniture and equipment purchases as well as building operating lease payments and receipts, and reimbursement for the use of a private aircraft service by the Company’s officers and directors. The transactions which occurred during the years ended December 31, 2017, 2016 and 2015 are outlined below (in thousands): December 31, (dollars in thousands) 2017 2016 2015 Tax, utility, insurance and other reimbursement $ 796 $ 878 $ 589 Rent expense 1,014 1,014 1,014 Capital assets acquired 561 323 261 Total $ 2,371 $ 2,215 $ 1,864 |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2017 | |
Employee Benefit Plan [Abstract] | |
Employee Benefit Plan | 10. Employee Benefit Plan The Company sponsors a defined contribution 401(k) retirement plan covering all eligible employees. Qualified employees may elect to contribute to the 401(k) Plan on a pre-tax basis. The maximum amount of employee contribution is subject only to statutory limitations. Starting on January 1, 2015, the Company matched 50% of the first 6% of contributions made by employees. Since January 1, 2016, the Company has matched 100% of the first 1% of contributions and 50% of the next 5% of contributions made by employees. The Company contributed $2.6 million, $2.5 million and $1.3 million to the 401(k) Plan for the years ended December 31, 2017, 2016 and 2015, respectively. |
Noncontrolling Interest
Noncontrolling Interest | 12 Months Ended |
Dec. 31, 2017 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interest | 11. Noncontrolling Interest Concurrently with the completion of the IPO, QTS consummated a series of transactions pursuant to which QTS became the sole general partner and majority owner of QualityTech, LP, which then became its operating partnership. The previous owners of QualityTech, LP retained 21.2% ownership of the Operating Partnership as of the date of the IPO. Commencing at any time beginning November 1, 2014, at the election of the holders of the noncontrolling interest, the Class A units of the Operating Partnership are redeemable for cash or, at the election of the Company, Class A common stock of the Company on a one-for-one basis. As a result of approximately 0.6 million redemptions of Class A units into Class A common stock and the issuance of additional common stock, the noncontrolling ownership interest of QualityTech, LP was 11.4% at December 31, 2017 compared to 12.4% at December 31, 2016. |
Earnings per share of QTS Realt
Earnings per share of QTS Realty Trust, Inc. | 12 Months Ended |
Dec. 31, 2017 | |
Earnings per Share [Abstract] | |
Earnings per share of QTS Realty Trust, Inc. | 12. Earnings per share of QTS Realty Trust, Inc. Basic 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 income per share adjusts basic income per share for the effects of potentially dilutive common shares. Unvested restricted stock awards contain non-forfeitable rights to dividends and thus are participating securities and are included in the computation of earnings per share pursuant to the two-class method for all periods presented. The two-class method is an earnings allocation formula that treats a participating security as having rights to undistributed earnings that would otherwise have been available to common stockholders. Accordingly, service-based restricted stock awards were included in the calculation of earnings per share using the two-class method for all periods presented. The computation of basic and diluted net income per share is as follows (in thousands, except per share data): Year Ended December 31, 2017 2016 2015 Numerator: Net income available to common stockholders - basic $ 1,282 $ 21,525 $ 20,326 Effect of net income attributable to noncontrolling interests and income allocated to participating securities Net income available to common stockholders $ 689 $ 24,685 $ 24,129 Denominator: Weighted average shares outstanding - basic Effect of Class A and Class RS partnership units * Effect of Class O units and options to purchase Class A common stock and restricted Class A common stock on an "as if" converted basis * 779 Weighted average shares outstanding - diluted 55,856 Basic net income per share $ 0.01 $ 0.47 $ 0.54 Diluted net income per share $ 0.01 $ 0.46 $ 0.53 * The Class A units and Class O units represent limited partnership interests in the Operating Partnership, and are described in more detail in Note 8 No securities were antidilutive for the years ended December 31, 2017, 2016 and 2015, and as such, no securities were excluded from the computation of diluted net income per share for those periods. |
Operating Leases, as Lessee
Operating Leases, as Lessee | 12 Months Ended |
Dec. 31, 2017 | |
Leases [Abstract] | |
Operating Leases, as Lessee | 13. Operating Leases, as Lessee The Company leases and/or licenses several data center facilities and related equipment, its corporate headquarters and additional office space. Many of the data center facilities that the Company leases were acquired in 2015 through its acquisition of Carpathia. In addition, the Company has entered into a long-term ground sublease for its Santa Clara property through October 2052. Rent expense for the aforementioned leases was $17.9 million, $20.1 million and $14.6 million for the years ended December 31, 2017, 2016 and 2015, respectively, and is classified in property operating costs and general and administrative expenses in the accompanying Statements of Operations. The Company recorded $0.1 million of capitalized rent for the year ended December 31, 2016, respectively. The Company recorded no capitalized rent for the years ended December 31, 2017 and 2015. The future non-cancellable minimum rental payments required under operating leases and/or licenses at December 31, 2017 are as follows (in thousands): Year Ending December 31, 2018 $ 15,031 2019 10,259 2020 9,894 2021 9,931 2022 9,675 Thereafter 65,126 Total $ 119,916 |
Customer Leases, as Lessor
Customer Leases, as Lessor | 12 Months Ended |
Dec. 31, 2017 | |
Leases [Abstract] | |
Customer Leases, as Lessor | 14. Customer Leases, as Lessor Future minimum lease payments to be received under non-cancelable operating customer leases (inclusive of payments for contracts which have not yet commenced and exclusive of recoveries of operating costs from customers) are as follows for the years ending December 31 (in thousands): Year Ending December 31, 2018 $ 334,594 2019 239,485 2020 172,280 2021 130,969 2022 84,660 Thereafter 82,873 Total $ 1,044,861 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value of Financial Instruments [Abstract] | |
Fair Value of Financial Instruments | 15. Fair Value of Financial Instruments ASC Topic 825 requires disclosure of fair value information about financial instruments, whether or not recognized in the consolidated balance sheets, for which it is practicable to estimate that value. In cases where quoted market prices are not available, fair values are based upon the application of discount rates to estimated future cash flows based upon market yields or by using other valuation methodologies. Considerable judgment is necessary to interpret market data and develop estimated fair value. Accordingly, fair values are not necessarily indicative of the amounts the Company could realize on disposition of the financial instruments. The use of different market assumptions and/or estimation methodologies may have a material effect on estimated fair value amounts. Short-term instruments: The carrying amounts of cash and cash equivalents and restricted cash approximate fair value. Interest rate swaps: The effective portion of changes in the fair value of the Company’s interest rate swaps, which are derivatives designated and that qualify as cash flow hedges, is recorded in accumulated other comprehensive income or loss on the consolidated balance sheets and statement of comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. There was no ineffectiveness recognized for the year ended December 31, 2017, therefore the entire $1.4 million unrealized gain for the year ended December 31, 2017 related to the interest rate swaps was recorded in accumulated other comprehensive income. No amounts were recorded in other comprehensive income or loss on the consolidated financial statements as of and for the years ended December 31, 2016 and 2015. The $1.4 million interest rate swap asset as of December 31, 2017 is recorded within the condensed consolidated balance sheet within the ‘Other Assets, Net’ line item. The Company valued its interest rate swaps utilizing Level 2 and Level 3 inputs. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The majority of the inputs used to determine the fair value of the interest rate swaps fall within Level 2 of the fair value hierarchy while certain credit valuation adjustments to the fair value utilize Level 3 inputs such as estimates of current credit spreads to evaluate the likelihood of default by the Company and its counterparties. However, as of December 31, 2017, the Company assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives. As a result, the Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. The Company does not have any fair value measurements on a recurring basis using significant unobservable inputs (Level 3) as of December 31, 2017 or December 31, 2016. Credit facility and Senior Notes: The Company’s unsecured credit facility did not have interest rates which were materially different than current market conditions and therefore, the fair value approximated the carrying value. The fair value of the Company’s Senior Notes was estimated using Level 2 “significant other observable inputs,” primarily based on quoted market prices for the same or similar issuances. At December 31, 2017, the fair value of the Senior Notes was approximately $404.0 million. Other debt instruments: The fair value of the Company’s other debt instruments (including capital leases, lease financing obligations and mortgage notes payable) were estimated in the same manner as the unsecured credit facility above. Similarly, each of these instruments did not have interest rates which were materially different than current market conditions and therefore, the fair value of each instrument approximated the respective carrying values. |
Quarterly Financial Information
Quarterly Financial Information | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information [Abstract] | |
Quarterly Financial Information | 16. Quarterly Financial Information (unaudited) The tables below reflect the selected quarterly information for the years ended December 31, 2017 and 2016 for QTS (in thousands except share data): + Three Months Ended December 31, September 30, June 30, March 31, 2017 Revenues $ 118,911 $ 113,767 $ 107,868 $ 105,964 Operating income 7,553 12,833 10,826 10,915 Net income (loss) (16,113) 7,394 4,608 5,568 Net income (loss) attributable to common shares (14,142) 6,507 4,040 4,877 Net income (loss) per share attributable to common shares - basic (0.29) 0.13 0.08 0.10 Net income (loss) per share attributable to common shares - diluted (0.29) 0.13 0.08 0.10 2016 Revenues $ 105,443 $ 103,465 $ 98,687 $ 94,768 Operating income 11,092 8,505 8,225 10,235 Net income 5,481 6,538 5,807 6,859 Net income attributable to common shares 4,806 5,730 5,100 5,889 Net income per share attributable to common shares - basic 0.10 0.12 0.11 0.14 Net income per share attributable to common shares - diluted 0.10 0.12 0.10 0.14 The table below reflects the selected quarterly information for the years ended December 31, 2017 and 2016 for the Operating Partnership (in thousands): Three Months Ended December 31, September 30, June 30, March 31, 2017 Revenues $ 118,911 $ 113,767 $ 107,868 $ 105,964 Operating income 7,553 12,833 10,826 10,915 Net income (loss) (16,113) 7,394 4,608 5,568 2016 Revenues $ 105,443 $ 103,465 $ 98,687 $ 94,768 Operating income 11,092 8,505 8,225 10,235 Net income 5,481 6,538 5,807 6,859 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | 17. Subsequent Events On January 5, 2018, the Company paid its regular quarterly cash dividend of $0.39 per common share and per unit in the Operating Partnership to stockholders and unit holders of record as of the close of business on December 5, 2017. On February 20, 2018, the Company announced that its board of directors authorized payment of a regular quarterly cash dividend of $0.41 per common share and per unit in the Operating Partnership, payable on April 5, 2018, to stockholders and unit holders of record as of the close of business on March 22, 2018. On February 20, 2018, the Company commenced a restructuring plan (the “Restructuring Plan”) regarding the organization of its business and product offerings. Under the Restructuring Plan, the Company intends to realign its product offerings around hyperscale and hybrid colocation (which generally includes what the Company formerly referred to as its C1 and C2 products, along with technology and services associated with the C3 products that directly support its C2 colocation customers), while narrowing its focus around certain of its Cloud and Managed Services offerings (which generally includes the remainder of what the Company formerly referred to as its C3 products) including some estimated colocation impact from customers using an integrated solution, and to implement a broader cost reduction initiative reflecting the Company’s simplified product set. The purpose of the restructuring plan is to increase growth, profitability and predictability in the Company’s business, while also reducing complexity and simplifying the Company’s cost structure. In connection with the Restructuring Plan, the Company expects to incur costs as a result of cash payments for severance, stay bonuses and related benefits to affected employees. Additionally, the Company expects to incur other costs such as termination, disposition and impairment costs that will vary based on the timing and structure of the Company’s exit of its non-core business, including through a potential disposition. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2017 | |
Schedule II - Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts | QTS REALTY TRUST, INC. QUALITYTECH, LP CONSOLIDATED FINANCIAL STATEMENTS SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS December 31, 2017 Balance at Balance at Year Ended December 31, beginning of Charge to Additions/ end of (dollars in thousands) period expenses (Deductions) period Allowance for doubtful accounts 2017 $ 4,217 $ 7,375 $ (139) $ 11,453 2016 5,063 1,752 (2,598) 4,217 2015 3,748 1,323 (8) 5,063 Valuation allowance for deferred tax assets 2017 $ 393 $ 320 $ — $ 713 2016 393 — — 393 2015 3,788 — (3,395) 393 |
Schedule III - Real Estate Inve
Schedule III - Real Estate Investments | 12 Months Ended |
Dec. 31, 2017 | |
Schedule III - Real Estate Investments [Abstract] | |
Schedule III - Real Estate Investments | QTS REALTY TRUST, INC. QUALITYTECH, LP CONSOLIDATED FINANCIAL STATEMENTS SCHEDULE III – REAL ESTATE INVESTMENTS December 31, 2017 Initial Costs Costs Capitalized Subsequent to Acquisition Gross Carrying Amount As of December 31, 2017 Accumulated (dollars in thousands) Buildings and Construction Buildings and Construction Buildings and Construction Depreciation and Date of Property Location Land Improvements in Progress Land Improvements in Progress Land Improvements in Progress Amortization (1) Acquisition Owned Properties Atlanta, Georgia (Atlanta-Metro) $ 12,647 $ 35,473 $ — $ 7,769 $ 417,363 $ 28,614 $ 20,416 $ 452,836 $ 28,614 $ (139,859) 10/3/2006 Irving, Texas — 5,808 — 8,606 271,086 86,320 8,606 276,894 86,320 (23,997) 2/8/2013 Richmond, Virginia 2,000 11,200 — 180 243,403 61,888 2,180 254,603 61,888 (49,561) 3/20/2010 Chicago, Illinois — — 17,764 9,400 81,463 117,715 9,400 81,463 135,479 (4,619) 7/8/2014 Suwanee, Georgia (Atlanta-Suwanee) 1,395 29,802 — 2,126 136,113 3,620 3,521 165,915 3,620 (61,029) 9/1/2005 Piscataway, New Jersey 7,466 80,366 13,900 — 2,885 23,907 7,466 83,251 37,807 (3,610) 6/6/2016 Santa Clara, California — 15,838 — — 84,190 6,989 — 100,028 6,989 (36,662) 11/1/2007 Sacramento, California 1,481 52,753 — — 11,498 58 1,481 64,251 58 (9,224) 12/21/2012 Fort Worth, Texas 136 610 48,984 8,943 17,284 (15,210) 9,079 17,894 33,774 (434) 12/16/2016 Princeton, New Jersey 20,700 32,126 — — 822 451 20,700 32,948 451 (3,059) 6/30/2014 Dulles, Virginia 3,154 29,583 — — 46,656 3,565 3,154 76,239 3,565 (15,861) 10/6/2017 Ashburn, Virginia (2) — — 53,009 — — 53,943 — — 106,952 — 8/9/2017 & 10/23/2017 Phoenix, Arizona (2) — — 24,668 — — 2,734 — — 27,402 — 8/11/2017 Hillsboro, Oregon (2) — — 25,657 — — 3,621 — — 29,278 — 10/3/2017 Miami, Florida 1,777 6,955 — — 23,989 48 1,777 30,944 48 (10,077) 3/6/2008 Lenexa, Kansas 400 3,100 — 36 734 2 436 3,834 2 (335) 6/3/2011 $ 51,156 $ 303,614 $ 183,982 $ 37,060 $ 1,337,486 $ 378,265 $ 88,216 $ 1,641,100 $ 562,247 $ (358,327) Leased Properties Leased Facilities acquired in 2015 — 59,087 — — (23,278) 146 — 35,809 146 (24,512) 6/16/2015 Jersey City, New Jersey — 1,985 — — 21,663 5,388 — 23,648 5,388 (11,411) 11/1/2006 Overland Park, Kansas — — — — 730 38 — 730 38 (573) $ — $ 61,072 $ — $ — $ (885) $ 5,572 $ — $ 60,187 $ 5,572 $ (36,496) $ 51,156 $ 364,686 $ 183,982 $ 37,060 $ 1,336,601 $ 383,837 $ 88,216 $ 1,701,287 $ 567,819 $ (394,823) (1) See Note 2 ‘Significant Accounting Policies’ for information regarding asset lives on which depreciation and amortization are calculated. (2) Represent land purchases. Land acquisition costs, as well as subsequent development costs, are included within construction in progress until development on the land has ended and the asset is ready for its intended use. The aggregate gross cost of the Company’s properties for federal income tax purposes was $2.44 billion (unaudited) as of December 31, 2017. The following table reconciles the historical cost and accumulated depreciation for the years ended December 31, 2017, 2016 and 2015 (in thousands): Year Ended December 31, 2017 2016 2015 Property Balance, beginning of period $ 1,964,857 $ 1,583,153 $ 1,177,582 Disposals (18,198) (8,946) (5,617) Additions (acquisitions and improvements) 410,663 390,650 411,188 Balance, end of period $ 2,357,322 $ 1,964,857 $ 1,583,153 Accumulated depreciation Balance, beginning of period $ (317,834) $ (239,936) $ (180,167) Disposals 13,970 6,761 1,377 Additions (depreciation and amortization expense) (90,959) (84,659) (61,146) Balance, end of period $ (394,823) $ (317,834) $ (239,936) |
Summary of Significant Accoun27
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation – The accompanying financial statements have been prepared by management in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The accompanying financial statements are presented for both QTS Realty Trust, Inc. and QualityTech, LP. References to “QTS” mean QTS Realty Trust, Inc. and its controlled subsidiaries; and references to the “Operating Partnership” mean QualityTech, LP and its controlled subsidiaries. In 2016, the Company adopted ASU 2015-02, Amendments to the Consolidation Analysis. This standard amends certain guidance applicable to the consolidation of various legal entities, including variable interest entities (“VIE”). The Company evaluated the application of the ASU and concluded that no change was required to its accounting for its interest in the Operating Partnership. However, under the new guidance, the Operating Partnership now meets the definition and criteria of a VIE and the Company is the primary beneficiary of the VIE. As discussed below, the Company’s only material asset is its ownership interest in the Operating Partnership, and consequently, all of its assets and liabilities represent those assets and liabilities of the Operating Partnership. The Company’s debt is an obligation of the Operating Partnership where the creditors may have recourse, under certain circumstances, against the credit of the Company. QTS is the sole general partner of the Operating Partnership, and its only material asset consists of its ownership interest in the Operating Partnership. Management operates QTS and the Operating Partnership as one business. The management of QTS consists of the same employees as the management of the Operating Partnership. QTS does not conduct business itself, other than acting as the sole general partner of the Operating Partnership and issuing public equity from time to time. QTS has not issued or guaranteed any indebtedness. Except for net proceeds from public equity issuances by QTS, which are contributed to the Operating Partnership in exchange for units of limited partnership interest of the Operating Partnership, the Operating Partnership generates all remaining capital required by the business through its operations, the direct or indirect incurrence of indebtedness, and the issuance of partnership units. Therefore, as general partner with control of the Operating Partnership, QTS consolidates the Operating Partnership for financial reporting purposes. The Company believes, therefore, that providing one set of notes for the financial statements of QTS and the Operating Partnership provides the following benefits: · enhances investors’ understanding of QTS and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business; · eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the disclosure applies to both QTS and the Operating Partnership; and · creates time and cost efficiencies through the preparation of one set of notes instead of two separate sets of notes. In addition, in light of these combined notes, the Company believes it is important for investors to understand the few differences between QTS and the Operating Partnership in the context of how QTS and the Operating Partnership operate as a consolidated company. With respect to balance sheets, the presentation of stockholders’ equity and partners’ capital are the main areas of difference between the consolidated balance sheets of QTS and those of the Operating Partnership. On the Operating Partnership’s consolidated balance sheets, partners’ capital includes partnership units that are owned by QTS and other partners. On QTS’ consolidated balance sheets, stockholders’ equity includes common stock, additional paid in capital, accumulated other comprehensive income (loss) and accumulated dividends in excess of earnings. The remaining equity reflected on QTS’s consolidated balance sheet is the portion of net assets that are retained by partners other than QTS, referred to as noncontrolling interests. With respect to statements of operations, the primary difference in QTS' Statements of Operations and Statements of Comprehensive Income is that for net income (loss), QTS retains its proportionate share of the net income (loss) based on its ownership of the Operating Partnership, with the remaining balance being retained by the Operating Partnership. These combined notes refer to actions or holdings as being actions or holdings of “the Company.” Although the Operating Partnership is generally the entity that enters into contracts, holds assets and issues debt, management believes that these general references to “the Company” in this context is appropriate because the business is one enterprise operated through the Operating Partnership. As discussed above, QTS owns no operating assets and has no operations independent of the Operating Partnership and its subsidiaries. Also, the Operating Partnership owns no operating assets and has no operations independent of its subsidiaries. Obligations under the 4.75% Notes due 2025 and the unsecured credit facility, both discussed in Note 5, are fully, unconditionally, and jointly and severally guaranteed by the Operating Partnership’s existing subsidiaries, other than: QTS Finance Corporation, the co-issuer of the 4.75% Notes due 2025. The indenture governing the 4.75% Notes due 2025 restricts the ability of the Operating Partnership to make distributions to QTS, subject to certain exceptions, including distributions required in order for QTS to maintain its status as a real estate investment trust under the Internal Revenue Code of 1986, as amended (the “Code”). The consolidated financial statements of QTS Realty Trust, Inc. include the accounts of QTS Realty Trust, Inc. and its majority owned subsidiaries. This includes the operating results of the Operating Partnership for all periods presented. |
Use of Estimates | Use of Estimates – The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the useful lives of fixed assets, allowances for doubtful accounts and deferred tax assets and the valuation of derivatives, real estate assets, acquired intangible assets and certain accruals. |
Principles of Consolidation | Principles of Consolidation – The consolidated financial statements of QTS Realty Trust, Inc. include the accounts of QTS Realty Trust, Inc. and its majority-owned subsidiaries. The consolidated financial statements of QualityTech, LP include the accounts of QualityTech, LP and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in the financial statements. |
Reclassifications | Reclassifications – The consolidated statement of cash flows for the year ended December 31, 2016 reflects a cash inflow reclassification of $0.9 million from “Payment of tax withholdings related to equity based awards” to “Proceeds from exercise of stock options.” The consolidated statement of cash flows for the year ended December 31, 2015 reflects a cash inflow reclassification of $0.6 million from “Accounts payable and accrued liabilities” to “Proceeds from exercise of stock options” as well as a cash outflow reclassification of $1.1 million from “Accounts payable and accrued liabilities” to “Payment of tax withholdings related to equity based awards.” Both 2016 and 2015 reclassifications were made in accordance with the Company’s adoption of ASU 2016-09, Improvements to Employee Share-Based Payment Accounting as of January 1, 2017 with retrospective application of this provision. |
Real Estate Assets | Real Estate Assets – Real estate assets are reported at cost. All capital improvements for the income-producing properties that extend their useful lives are capitalized to individual property improvements and depreciated over their estimated useful lives. Depreciation for real estate assets is generally provided on a straight-line basis over 40 years from the date the property was placed in service. Property improvements are depreciated on a straight-line basis over the life of the respective improvement ranging from 20 to 40 years from the date the components were placed in service. Leasehold improvements are depreciated over the lesser of 20 years or through the end of the respective life of the lease. Repairs and maintenance costs are expensed as incurred. For the year ended December 31, 2017, depreciation expense related to real estate assets and non-real estate assets was $90.1 million and $14.2 million, respectively, for a total of $104.3 million. For the year ended December 31, 2016, depreciation expense related to real estate assets and non-real estate assets was $77.5 million and $13.1 million, respectively, for a total of $90.6 million. For the year ended December 31, 2015, depreciation expense related to real estate assets and non-real estate assets was $55.2 million and $9.8 million, respectively, for a total of $65.0 million. The Company capitalizes certain development costs, including internal costs incurred in connection with development. The capitalization of costs during the construction period (including interest and related loan fees, property taxes and other direct and indirect costs) begins when development efforts commence and ends when the asset is ready for its intended use. Capitalization of such costs, excluding interest, aggregated to $12.7 million, $11.0 million and $10.8 million for the years ended December 31, 2017, 2016 and 2015 respectively. Interest is capitalized during the period of development by first applying the Company’s actual borrowing rate on the related asset and second, to the extent necessary, by applying the Company’s weighted average effective borrowing rate to the actual development and other costs expended during the construction period. Interest is capitalized until the property is ready for its intended use. Interest costs capitalized totaled $14.3 million, $11.4 million and $9.8 million for the years ended December 31, 2017, 2016 and 2015, respectively. |
Acquisitions | Acquisitions – Acquisitions of real estate and other entities are either accounted for as asset acquisitions or business combinations depending on facts and circumstances. Purchase accounting is applied to the assets and liabilities related to all real estate investments acquired in accordance with the accounting requirements of ASC 805, Business Combinations , which requires the recording of net assets of acquired businesses at fair value. The fair value of the consideration transferred is allocated to the acquired tangible assets, consisting primarily of land, construction in progress, building and improvements, and identified intangible assets and liabilities, consisting of the value of above-market and below-market leases, value of in-place leases, value of customer relationships, trade names, software intangibles and capital leases. The excess of the fair value of liabilities assumed, common stock issued and cash paid over the fair value of identifiable assets acquired is allocated to goodwill, which is not amortized by the Company. In developing estimates of fair value of acquired assets and assumed liabilities, management analyzed a variety of factors including market data, estimated future cash flows of the acquired operations, industry growth rates, current replacement cost for fixed assets and market rate assumptions for contractual obligations. Such a valuation requires management to make significant estimates and assumptions, particularly with respect to the intangible assets. Acquired in-place leases are amortized as amortization expense on a straight-line basis over the remaining life of the underlying leases. This amortization expense is accounted for as real estate amortization expense. Acquired customer relationships are amortized as amortization expense on a straight-line basis over the expected life of the customer relationship. This amortization expense is accounted for as real estate amortization expense. Other acquired intangible assets, which includes platform, above or below market leases, and trade name intangibles, are amortized on a straight-line basis over their respective expected lives. Above or below market leases are amortized as a reduction to or increase in rental revenue when the Company is a lessor as well as a reduction or increase to rent expense over the remaining lease terms in the case of the Company as lessee. The expense associated with above and below market leases and trade name intangibles is accounted for as real estate expense, whereas the expense associated with the amortization of platform intangibles is accounted for as non-real estate expense. See Note 3 for discussion of the final purchase price allocation for the Piscataway, New Jersey facility (the “Piscataway facility”) that the Company acquired on June 6, 2016, as well as the final purchase price allocation for the Fort Worth, Texas facility (the “Fort Worth facility”) that the Company acquired on December 16, 2016. |
Impairment of Long-Lived and Intangible Assets | Impairment of Long-Lived Assets, Intangible Assets and Goodwill – The Company reviews its long-lived assets and intangible assets for impairment when events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Recoverability of assets to be held and used is measured by comparison of the carrying amount to the future net cash flows, undiscounted and without interest, expected to be generated by the asset group. If the net carrying value of the asset exceeds the value of the undiscounted cash flows, the fair value of the asset is assessed and may be considered impaired. An impairment loss is recognized based on the excess of the carrying amount of the impaired asset over its fair value. For the year ended December 31, 2017, the Company recognized a $1.6 million impairment related to equipment used to support its cloud and managed service platform. The impairment charge is included in the “Transaction, integration and impairment costs” line item of the consolidated statement of operations. No impairment losses were recorded for the years ended December 31, 2016 and 2015 . The fair value of goodwill is the consideration transferred which is not allocable to identifiable intangible and tangible assets. Goodwill is subject to at least an annual assessment for impairment. In connection with the goodwill impairment evaluation that the Company performed on October 1, 2017, the Company determined qualitatively that it is not more likely than not that the fair value of the Company’s one reporting unit was less than the carrying amount, thus it did not perform a quantitative analysis. |
Cash and Cash Equivalents | Cash and Cash Equivalents – The Company considers all demand deposits and money market accounts purchased with a maturity date of three months or less at the date of purchase to be cash equivalents. The Company’s account balances at one or more institutions periodically exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and, as a result, there is concentration of credit risk related to amounts on deposit in excess of FDIC coverage. The Company mitigates this risk by depositing a majority of its funds with several major financial institutions. The Company also has not experienced any losses and, therefore, does not believe that the risk is significant. |
Deferred Costs | Deferred Costs – Deferred costs, net, on the Company’s balance sheets include both financing costs and leasing costs. Deferred financing costs represent fees and other costs incurred in connection with obtaining debt and are amortized over the term of the loan and are included in interest expense. Debt issuance costs related to revolving debt arrangements are deferred and presented as assets on the balance sheet; however, all other debt issuance costs are recorded as a direct offset to the associated liability. Amortization of debt issuance costs, including those costs presented as offsets to the associated liability in the consolidated balance sheet, were $3.6 million, $3.3 million and $3.2 million for the years ended December 31, 2017, 2016 and 2015, respectively. During the year ended December 31, 2017, the Company wrote off unamortized financing costs of $5.2 million to the income statement primarily in connection with the replacement of its $300 million 5.875% senior notes with the $400 million of 4.75% notes. During the year ended December 31, 2016, the Company wrote off unamortized financing costs of $0.2 million to the income statement in connection with the modification of its unsecured credit facility in December 2016 whereby the company increased the total capacity and extended the term for an additional year. During the year ended December 31, 2015, the Company wrote off unamortized financing costs of $0.5 million to the income statement in connection with the repayment of the Atlanta Metro equipment loan in June 2015 as well as the amendment of its unsecured credit facility in October 2015 whereby the Company increased the unsecured credit facility capacity, and, at the same time, terminated its Richmond credit facility. Deferred financing costs presented as assets on the balance sheet related to revolving debt arrangements, net of accumulated amortization are as follows: December 31, December 31, (dollars in thousands) 2017 2016 Deferred financing costs $ 9,775 $ 7,128 Accumulated amortization (1,908) (145) Deferred financing costs, net $ 7,867 $ 6,983 Deferred financing costs presented as offsets to the associated liabilities on the balance sheet related to fixed debt arrangements, net of accumulated amortization, are as follows: December 31, December 31, (dollars in thousands) 2017 2016 Deferred financing costs $ 12,675 $ 12,779 Accumulated amortization (1,039) (2,660) Deferred financing costs, net $ 11,636 $ 10,119 Deferred leasing costs consist of external fees and internal costs incurred in the successful negotiations of leases and are deferred and amortized over the terms of the related leases on a straight-line basis. If an applicable lease terminates prior to the expiration of its initial term, the carrying amount of the costs are written off to amortization expense. Amortization of deferred leasing costs totaled $18.5 million, $15.2 million and $11.8 million for the years ended December 31, 2017, 2016 and 2015, respectively. Deferred leasing costs, net of accumulated amortization are as follows: December 31, December 31, (dollars in thousands) 2017 2016 Deferred leasing costs $ 54,868 $ 50,026 Accumulated amortization (20,956) (18,502) Deferred leasing costs, net $ 33,912 $ 31,524 |
Advance Rents and Security Deposits | Advance Rents and Security Deposits – Advance rents, typically prepayment of the following month’s rent, consist of payments received from customers prior to the time they are earned and are recognized as revenue in subsequent periods when earned. Security deposits are collected from customers at the lease origination and are generally refunded to customers upon lease expiration. |
Deferred Income | Deferred Income – Deferred income generally results from non-refundable charges paid by the customer at lease inception to prepare their space for occupancy. The Company records this initial payment, commonly referred to as set-up fees, as a deferred income liability which amortizes into rental revenue over the term of the related lease on a straight-line basis. Deferred income was $25.3 million, $22.0 million and $17.0 million as of December 31, 2017, 2016 and 2015, respectively. Additionally, $10.7 million, $9.4 million and $6.0 million of deferred income was amortized into revenue for the years ended December 31, 2017, 2016 and 2015, respectively. |
Equity-based Compensation | Equity-based Compensation – All equity-based compensation is measured at fair value on the grant date, and recognized in earnings over the requisite service period. Equity-based compensation costs are measured based upon their estimated fair value on the date of grant or modification and amortized ratably over their respective vesting periods. We have elected to account for forfeitures as they occur. Equity-based compensation expense net of forfeited and repurchased awards was $13.9 million, $10.6 million and $7.0 million for the years ended December 31, 2017, 2016 and 2015, respectively. |
Rental Revenue | Rental Revenue – The Company, as a lessor, has retained substantially all of the risks and benefits of ownership and accounts for its leases as operating leases. For lease agreements that provide for scheduled rent increases, rental income is recognized on a straight-line basis over the non-cancellable term of the leases, which commences when control of the space has been provided to the customer. The amount of the straight-line rent receivable on the balance sheets included in rents and other receivables, net was $23.4 million and $17.3 million as of December 31, 2017 and December 31, 2016, respectively. Rental revenue also includes amortization of set-up fees which are amortized over the term of the respective lease as discussed above. |
Cloud and Managed Services Revenue | Cloud and Managed Services Revenue – The Company may provide both its cloud product and use of its managed services to its customers on an individual or combined basis. Service fee revenue is recognized as the revenue is earned, which generally coincides with the services being provided. |
Allowance for Uncollectible Accounts Receivable | Allowance for Uncollectible Accounts Receivable – Rents receivable are recognized when due and are carried at cost, less an allowance for doubtful accounts. The Company records a provision for losses on rents receivable equal to the estimated uncollectible accounts, which is based on management’s historical experience and a review of the current status of the Company’s receivables. As necessary, the Company also establishes an appropriate allowance for doubtful accounts for receivables arising from the straight-lining of rents. The aggregate allowance for doubtful accounts was $11.5 million and $4.2 million as of December 31, 2017 and December 31, 2016, respectively. |
Capital Leases and Lease Financing Obligations | Capital Leases and Lease Financing Obligations – The Company evaluates leased real estate to determine whether the lease should be classified as a capital or operating lease in accordance with U.S. GAAP. The Company periodically enters into capital leases for certain equipment. In addition, through its acquisition of Carpathia on June 16, 2015, the Company is party to capital leases for property and equipment, as well as certain financing obligations. The outstanding liabilities for the capital leases were $7.8 million and $18.1 million as of December 31, 2017 and 2016, respectively. During the quarter ended December 31, 2017, the Company completed the buyout of the Vault facility in Dulles, VA that was previously subject to a lease financing obligation, therefore the outstanding liabilities for the lease financing obligations were $0.9 million and $20.6 million as of December 31, 2017 and 2016, respectively. The net book value of the assets associated with these leases was approximately $14.7 million and $41.5 million as of December 31, 2017 and 2016, respectively. Depreciation related to the associated assets is included in depreciation and amortization expense in the Statements of Operations. See Note 6 for further discussion of capital leases and lease financing obligations. |
Recoveries from Customers | Recoveries from Customers – Certain customer leases contain provisions under which the customers reimburse the Company for a portion of the property’s real estate taxes, insurance and other operating expenses, which include certain power and cooling-related charges. The reimbursements are included in revenue as recoveries from customers in the Statements of Operations in the period the applicable expenditures are incurred. Certain customer leases are structured to provide a fixed monthly billing amount that includes an estimate of various operating expenses, with all revenue from such leases included in rental revenues. |
Segment Information | Segment Information – The Company manages its business as one operating segment and thus one reportable segment consisting of a portfolio of investments in data centers located primarily in the United States. |
Customer Concentrations | Customer Concentrations – As of December 31, 2017, one of the Company’s customers represented 11.8% of its total monthly rental revenue. No other customers exceeded 4.5% of total monthly rental revenue. As of December 31, 2017, five of the Company’s customers exceeded 5% of total accounts receivable. In aggregate, these five customers accounted for 33% of total accounts receivable. None these five customers individually exceeded 10% of total accounts receivable. |
Income Taxes | Income Taxes – The Company has elected for two of its existing subsidiaries to be taxed as taxable REIT subsidiaries pursuant to the REIT rules of the U.S. Internal Revenue Code. For the taxable REIT subsidiaries, income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The components of income tax provision from continuing operations are: For the Year Ended December 31, 2017 2016 2015 Current: U.S. federal $ 42 $ (356) $ 462 U.S. State 297 20 11 Outside United States 44 33 — Total Current 383 (303) 473 Deferred: U.S. federal (9,734) (8,796) (8,952) U.S. State (427) (877) (1,586) Outside United States — — — Total Deferred (10,161) (9,673) (10,538) Total $ (9,778) $ (9,976) $ (10,065) As of December 31, 2014, one of the Company’s taxable REIT subsidiaries’ deferred tax assets were primarily the result of U.S. net operating loss carryforwards. A valuation allowance was recorded against its gross deferred tax asset balance as of December 31, 2014. As a result of the acquisition of Carpathia, the Company determined that it is more likely than not that pre-existing deferred tax assets would be realized by the Company, and the valuation allowance was eliminated. The change in the valuation allowance resulting from the change in circumstances was included in income, and recognized as a deferred income tax benefit in the year ended December 31, 2015. In addition to the deferred income tax benefit recognized in the year ended December 31, 2015 in connection with the elimination of the valuation allowance, a deferred tax benefit was recognized in the years ended December 31, 2017 and 2016 in connection with recorded operating losses. As of December 31, 2015, 2016 and 2017, this taxable REIT subsidiary has a net deferred tax liability position primarily due to customer-based intangibles acquired as part of the Carpathia acquisition. Temporary differences and carry forwards which give rise to the deferred tax assets and liabilities are as follows: For the Year Ended December 31, 2017 2016 2015 Deferred tax liabilities Property and equipment $ (4,940) $ (15,031) $ (16,032) Goodwill (1,396) (1,290) (407) Intangibles (13,606) (24,244) (23,896) Other (1,132) (1,386) (2,350) Gross deferred tax liabilities (21,074) (41,951) (42,685) Deferred tax assets Net operating loss carryforwards 8,888 18,035 14,500 Deferred revenue and setup charges 3,435 4,323 3,747 Leases 453 2,154 3,097 Credits 543 492 630 Bad debt reserve 2,250 41 539 Other 1,607 2,114 1,752 Gross deferred tax assets 17,176 27,159 24,265 Net deferred tax liability (3,898) (14,792) (18,420) Valuation allowance (713) (393) (393) Net deferred tax liability $ (4,611) $ (15,185) $ (18,813) The taxable REIT subsidiaries currently have $33.9 million of net operating loss carryforwards related to federal income taxes that expire in 12-20 years. The taxable REIT subsidiaries also have $35.8 million of net operating loss carryforwards relating to state income taxes that expire in 2-20 years. The effective tax rate is subject to change in the future due to various factors such as the operating performance of the taxable REIT subsidiaries, tax law changes and future business acquisitions. The Company’s effective tax rates were 65.1%, 46.5% and 34.8% for the years ended December 31, 2017, 2016 and 2015, respectively. The effective tax rate increase from 2016 to 2017 is primarily due to the federal rate change resulting from the enactment of the Tax Cuts and Jobs Act and state tax rate changes, offset by a comparative decrease in permanent differences and by the accounting for a valuation allowance. The differences between total income tax expense or benefit and the amount computed by applying the statutory income tax rate to income before provision for income taxes with respect to the TRS activity were as follows: For the Year Ended December 31, 2017 2016 2015 TRS Statutory rate of 34% applied to pre-tax loss $ (5,109) $ (7,299) $ (6,683) Permanent differences, net (284) (2,021) 281 State income tax, net of federal benefit (388) (689) (268) Foreign income tax 44 33 — Federal and State rate change (3,251) — — Contribution of Assets to TRS (866) — — Other (244) — — Valuation allowance (decrease) increase 320 — (3,395) Total tax benefit $ (9,778) $ (9,976) $ (10,065) Effective tax rate On December 22, 2017, the Tax Cuts and Jobs Act ("The Act"), was signed into law by President Trump. The tax legislation contains several provisions, including the lowering of the U.S. corporate tax rate from 35 percent to 21 percent, effective January 1, 2018. The Company has significant deferred tax liabilities, primarily related to fixed assets and intangibles, on its balance sheet as of December 31, 2017. The value of the net deferred tax liabilities has decreased significantly as a result of the reduction in the U.S. corporate income tax rate. Consequently, operating results reflect a one-time non-cash income tax benefit of $3.3 million to reflect the re-measurement of deferred tax assets (liabilities). The Act also repealed corporate alternative minimum tax (“AMT”) for tax years beginning January 1, 2018, and provides that existing AMT credit carryforwards are refundable beginning in 2018. The Company has approximately $0.3 million of AMT credit carryovers that are expected to be fully refunded by 2022. The repeal of AMT does not result in any one-time income tax expense (benefit) to operating results. The Company is following the guidance in SEC Staff Accounting Bulletin 118 (“SAB 118”), which provides additional clarification regarding the application of ASC Topic 740 in situations where the Company may not have the necessary information available, prepared, or analyzed in reasonable detail to complete the accounting for certain income tax effects of the Act for the reporting period in which the Act was enacted. SAB 118 provides for a measurement period beginning in the reporting period that includes the Act’s enactment date and ending when the Company has obtained, prepared, and analyzed the information needed in order to complete the accounting requirements but in no circumstances should the measurement period extend beyond one year from the enactment date. Upon completion of the Company’s 2017 U.S. income tax return in 2018, additional re-measurement adjustments may be identified with respect to the recorded deferred tax assets (liabilities). The Company will continue to assess the provision for income taxes as future guidance is issued, but does not currently anticipate that significant revisions will be necessary. Any such revisions will be treated in accordance with the measurement period guidance outlined in SAB 118. As of December 31, 2017, 2016 and 2015, the Company had no uncertain tax positions. If the Company accrues any interest or penalties on tax liabilities from significant uncertain tax positions, those items will be classified as interest expense and general and administrative expense, respectively, in the Statements of Operations and Statements of Comprehensive Income. For the years ended December 31, 2017, 2016 and 2015, the Company had accrued no such interest or penalties. The Company is currently not under examination by the Internal Revenue Service. Tax years ending after December 31, 2013 remain subject to examination and assessment. Tax years ending December 31, 2009 through December 31, 2013 remain open solely for purposes of examination of our loss and credit carryforwards. The Company provides a valuation allowance against deferred tax assets, if, based on management’s assessment of operating results and other available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company’s fourth quarter of 2017 operating results reflect a non-cash $0.3 million valuation allowance attributable to state net operating losses generated where the Company has discontinued its operations or reduced its presence in certain state jurisdictions. The value of the net deferred tax assets may be subject to change in the future, depending upon our generation or projections of future taxable income, as well as changes in tax policy or tax planning strategies. |
Interest Rate Swaps | Interest Rate Swaps – On April 5, 2017, the Company entered into forward interest rate swap agreements with an aggregate notional amount of $400 million. The forward swap agreements effectively fix the interest rate on $400 million of term loan borrowings, $200 million of swaps allocated to each term loan, from January 2, 2018 through December 17, 2021 and April 27, 2022, respectively. The Company reflects its forward interest rate swap agreements, which are designated as cash flow hedges, at fair value as either assets or liabilities on the consolidated balance sheets. The forward interest rate swap agreements currently qualify for hedge accounting whereby the Company records 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. The Company’s objectives in using interest rate swaps are to reduce variability in interest expense and to manage exposure to adverse interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its 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. |
Fair Value Measurements | Fair Value Measurements – ASC Topic 820, Fair Value Measurement , emphasizes that fair-value is a market-based measurement, not an entity-specific measurement. Therefore, a fair-value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair-value measurements, a fair-value hierarchy is established that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair-value measurement is based on inputs from different levels of the fair-value hierarchy, the level in the fair-value hierarchy within which the entire fair-value measurement falls is based on the lowest level input that is significant to the fair-value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair-value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. As of December 31, 2017, the Company valued its interest rate swaps which were entered into in April 2017 utilizing primarily Level 2 inputs. There were no financial assets or liabilities measured at fair value on a recurring basis on the consolidated balance sheets as of December 31, 2016. The Company’s purchase price allocations of Piscataway and Fort Worth are fair value estimates that utilized Level 3 inputs and are measured on a non-recurring basis. See Note 3 for further detail on these acquisitions. |
New Accounting Pronouncements | New Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) , which supersedes the current revenue recognition requirements in ASC 605, Revenue Recognition . Under this new guidance, entities should recognize revenues to depict the transfer of promised goods or services to customers in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. This ASU also requires enhanced disclosures. In April 2016, the FASB finalized amendments to the guidance on identifying performance obligations and accounting for licenses of intellectual property. In May 2016, the FASB finalized amendments to the guidance related to the assessment of collectability, the definition of completed contracts at transition, and the measurement of the fair value of non-cash consideration at contract inception. The FASB also added new practical expedients for the presentation of sales taxes collected from customers and the accounting for contract modifications at transition. These amendments are not intended to change the core principles of the standard; however, they are intended to clarify important aspects of the guidance and improve its operability, as well as to address implementation issues. The amendments have the same effective date and transition requirements as the new revenue standard, which is effective for annual and interim periods beginning after December 15, 2017. Retrospective and modified retrospective application is allowed. The Company adopted ASC Topic 606 effective January 1, 2018 and elected the modified retrospective transition approach. ASC Topic 606 does not apply to leases, which are currently accounted for under ASC Topic 840, Leases , or ASC Topic 842, Leases , effective January 1, 2019. As leasing arrangements are excluded from the scope of the new revenue standard, ASC Topic 606 will not significantly impact the Company’s accounting for rental revenue. ASC Topic 606 also consolidates and simplifies the accounting for the Company’s cloud and managed services portfolio. The new standard does not impact the timing or amounts of revenue recognized related to the Company’s cloud and managed services portfolio. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , which supersedes the current lease guidance in ASC 840, Lease s. The core principle of Topic 842 requires lessees to recognize the assets and liabilities that arise from nearly all leases in the statement of financial position. Accounting applied by lessors will remain largely consistent with previous guidance, with additional changes set to align lessor accounting with the revised lessee model and the FASB’s revenue recognition guidance in Topic 606. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The standard requires a modified retrospective transition approach. The FASB has issued a Proposed Accounting Standards Update, Leases – Targeted Improvements , which proposes updates to the lease standard that include practical expedients that would remove the requirement to restate prior period financial statements upon adoption of the standard as well as a proposed practical expedient which allows lessors not to separate non-lease components from the related lease components if both the timing and pattern of revenue recognition are the same for the non-lease component(s) and related lease component and the combined single lease component would be classified as an operating lease. The Company plans to adopt ASC 842 effective January 1, 2019, and if the proposed accounting standards update is issued in final form, the Company will apply the transition relief under the new lease standard as of January 1, 2019. As lessee, the Company does not anticipate the classification of its leases to change but it will recognize a new initial lease liability and right-of-use asset on the consolidated balance sheet for all operating leases which is expected to be material to our consolidated balance sheet. As lessor, accounting for our leases will remain largely unchanged, apart from the narrower definition of initial direct costs that can be capitalized. The new lease standard more narrowly defines initial direct costs as only costs that are incremental at the signing of a lease. As the Company does not currently capitalize material non-incremental costs, it expects the impact of this change to be immaterial to the financial statements. If formally approved, the Proposed Accounting Standards Update , Leases – Targeted Improvements transition relief would eliminate the need for the Company to restate prior period comparative financial statements that would have included a right of use asset and liability from the Company’s operating leases as lessee. Additionally, from a lessor perspective, the transition relief would alleviate the Company’s need to separate lease from non-lease components within its rental revenue contracts. The Company will disclose any changes to this analysis as identified. In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting , which amends ASC 718, Compensation – Stock Compensation. The ASU includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements, including simplified income tax accounting for stock-based compensation, enhanced tax withholding rules, accounting policy options with regard to forfeitures and clarified guidance on statement of cash flow presentation. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company adopted this standard in the three months ended March 31, 2017, and provisions of the standard did not have a material impact on the consolidated financial statements. The consolidated statement of cash flows for the year ended December 31, 2016 reflects a cash inflow reclassification of $0.9 million from “Payment of tax withholdings related to equity based awards” to “Proceeds from exercise of stock options.” The consolidated statement of cash flows for the year ended December 31, 2015 reflects a cash inflow reclassification of $0.6 million from “Accounts payable and accrued liabilities” to “Proceeds from exercise of stock options” as well as a cash outflow reclassification of $1.1 million from “Accounts payable and accrued liabilities” to “Payment of tax withholdings related to equity based awards.” Both 2016 and 2015 reclassifications were made in accordance with the Company’s adoption of ASU 2016-09 as of January 1, 2017 with retrospective application of this provision. In August 2016, the FASB issued ASU 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 fiscal years beginning January 1, 2018, and subsequent interim periods. The Company does not expect the provisions of the standard will have a material impact on its consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, Accounting for Income Taxes: Intra-Entity Asset Transfers of Assets Other than Inventory . Under current GAAP, the tax effects of intra-entity asset transfers are deferred until the transferred asset is sold to a third party or otherwise recovered through use. The new guidance eliminates the exception for all intra-entity sales of assets other than inventory. As a result, a reporting entity would recognize the tax expense from the sale of the asset in the seller’s tax jurisdiction when the transfer occurs, even though the pre-tax effects of that transaction are eliminated in consolidation. Any deferred tax asset that arises in the buyer’s jurisdiction would also be recognized at the time of the transfer. The new guidance will be effective for public business entities in fiscal years beginning after December 15, 2017, including interim periods within those years. The Company will adopt in 2018, and does not expect the provisions of the standard will have a material impact on its consolidated financial statements. In January 2017, the FASB issued ASU 2017-01 , Business Combinations (Topic 805): Clarifying the Definition of a Business . The standard changes the definition of a business to assist entities with evaluating when a set of transferred assets and activities is a business. The guidance is effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those years. Early adoption is permitted. As a result of this new guidance, acquisitions may now be more likely to result in a transaction being classified as an asset purchase rather than a business combination. In January 2017, the FASB issued ASU 2017-04 , Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The new guidance eliminates the requirement to calculate the implied fair value of goodwill (i.e., Step 2 of today’s goodwill impairment test) to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value (i.e., measure the charge based on today’s Step 1). The guidance will be applied prospectively and is effective for calendar year-end public companies in 2020, with early adoption permitted for annual and interim goodwill impairment testing dates after January 1, 2017. The Company does not expect the provisions of the standard will have a material impact on its consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting . The provisions in the update provide guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The guidance seeks to provide clarity and reduce both diversity in practice and cost and complexity when changing the terms or conditions of a share-based payment award. The guidance will be applied prospectively and is effective for all entities for fiscal years beginning after December 15, 2017, and interim periods within those years. Early adoption is permitted. The Company will adopt the standard in 2018 and does not expect the provisions of the standard will have a material impact on its consolidated financial statements. In August 2017, the FASB issued ASU 2017-12; Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. The amendments in ASU 2017-12 change the recognition and presentation requirements of hedge accounting, including the elimination of the requirement to separately measure and report hedge ineffectiveness and the addition of a requirement to present all items that affect earnings in the same income statement line item as the hedged item. ASU 2017-12 also provides new alternatives for: applying hedge accounting to additional hedging strategies; measuring the hedged item in fair value hedges of interest rate risk; reducing the cost and complexity of applying hedge accounting by easing the requirements for effectiveness testing, hedge documentation and application of the critical terms match method; and reducing the risk of material error correction if a company applies the shortcut method inappropriately. The guidance is effective for public entities for fiscal years beginning after December 18, 2018, and interim periods within those fiscal years. Early application is permitted. The Company does not expect the provisions of the standard will have a material impact on its consolidated financial statements. |
Summary of Significant Accoun28
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Deferred Financing Costs, Net of Accumulated Amortization | December 31, December 31, (dollars in thousands) 2017 2016 Deferred financing costs $ 9,775 $ 7,128 Accumulated amortization (1,908) (145) Deferred financing costs, net $ 7,867 $ 6,983 |
Deferred Leasing Costs, Net of Accumulated Amortization | December 31, December 31, (dollars in thousands) 2017 2016 Deferred leasing costs $ 54,868 $ 50,026 Accumulated amortization (20,956) (18,502) Deferred leasing costs, net $ 33,912 $ 31,524 |
Schedule of components of income tax provision from continuing operations | For the Year Ended December 31, 2017 2016 2015 Current: U.S. federal $ 42 $ (356) $ 462 U.S. State 297 20 11 Outside United States 44 33 — Total Current 383 (303) 473 Deferred: U.S. federal (9,734) (8,796) (8,952) U.S. State (427) (877) (1,586) Outside United States — — — Total Deferred (10,161) (9,673) (10,538) Total $ (9,778) $ (9,976) $ (10,065) |
Summary of Temporary Differences and Carry Forwards Which Give Rise to the Deferred Tax Assets and Liabilities | For the Year Ended December 31, 2017 2016 2015 Deferred tax liabilities Property and equipment $ (4,940) $ (15,031) $ (16,032) Goodwill (1,396) (1,290) (407) Intangibles (13,606) (24,244) (23,896) Other (1,132) (1,386) (2,350) Gross deferred tax liabilities (21,074) (41,951) (42,685) Deferred tax assets Net operating loss carryforwards 8,888 18,035 14,500 Deferred revenue and setup charges 3,435 4,323 3,747 Leases 453 2,154 3,097 Credits 543 492 630 Bad debt reserve 2,250 41 539 Other 1,607 2,114 1,752 Gross deferred tax assets 17,176 27,159 24,265 Net deferred tax liability (3,898) (14,792) (18,420) Valuation allowance (713) (393) (393) Net deferred tax liability $ (4,611) $ (15,185) $ (18,813) |
Schedule of Differences between Total Income Tax or Benefit and Amount Computed by Applying the Statutory Income Tax Rate | For the Year Ended December 31, 2017 2016 2015 TRS Statutory rate of 34% applied to pre-tax loss $ (5,109) $ (7,299) $ (6,683) Permanent differences, net (284) (2,021) 281 State income tax, net of federal benefit (388) (689) (268) Foreign income tax 44 33 — Federal and State rate change (3,251) — — Contribution of Assets to TRS (866) — — Other (244) — — Valuation allowance (decrease) increase 320 — (3,395) Total tax benefit $ (9,778) $ (9,976) $ (10,065) Effective tax rate |
Fixed debt arrangements | |
Deferred Financing Costs, Net of Accumulated Amortization | December 31, December 31, (dollars in thousands) 2017 2016 Deferred financing costs $ 12,675 $ 12,779 Accumulated amortization (1,039) (2,660) Deferred financing costs, net $ 11,636 $ 10,119 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fort Worth Facility | |
Schedule of the Preliminary Allocation of the Fair Value of Assets Acquired and Liabilities Assumed in Acquisition | The following table summarizes the consideration for the Fort Worth facility and the final allocation of the fair value of assets acquired and liabilities assumed at the acquisition date (in thousands): Final Fort Worth Allocation as of Preliminary Allocation Reported as of December 31, 2016 Adjustments to Fair Value Land $ 136 $ 136 $ — Buildings and improvements 610 610 — Construction in progress 48,987 48,984 3 Acquired intangibles 237 240 (3) Deferred costs 23 23 — Other assets 7 7 — Net Working Capital 86 86 — Total identifiable assets acquired $ 50,086 $ 50,086 $ — |
Piscataway Facility | |
Schedule of the Preliminary Allocation of the Fair Value of Assets Acquired and Liabilities Assumed in Acquisition | The following table summarizes the consideration for the Piscataway facility and the final allocation of the fair value of assets acquired and liabilities assumed at the acquisition date (in thousands): Final Piscataway Allocation as of Preliminary Allocation Reported as of June 30, 2016 Adjustments to Fair Value Land $ 7,466 $ 7,440 $ 26 Buildings and improvements 80,366 78,370 1,996 Construction in progress 13,900 13,900 — Acquired intangibles 19,581 21,668 (2,087) Deferred costs 4,390 4,084 306 Other assets 106 106 — Total identifiable assets acquired 125,809 125,568 241 Acquired below market lease 809 568 241 Net working capital 2,019 2,019 — Total liabilities assumed 2,828 2,587 241 Net identifiable assets acquired $ 122,981 $ 122,981 $ — |
Acquired Intangibles Assets a30
Acquired Intangibles Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Acquired Intangible Assets and Liabilities | |
Schedule of carrying values for the major classes of intangible assets and liabilities | Summarized below are the carrying values for the major classes of intangible assets and liabilities (in thousands): December 31, 2017 December 31, 2016 Useful Lives Gross Accumulated Net Carrying Gross Accumulated Net Carrying Customer Relationships 1 to 12 years $ 95,705 $ (20,512) $ 75,193 $ 95,705 $ (12,358) $ 83,347 In-Place Leases 0.5 to 10 years 32,066 (12,987) 19,079 32,066 (7,197) 24,869 Solar Power Agreement (1) 17 years 13,747 (2,830) 10,917 13,747 (2,022) 11,725 Platform Intangible 3 years 9,600 (8,133) 1,467 9,600 (4,933) 4,667 Acquired Favorable Leases 0.5 to 8 years 4,649 (2,328) 2,321 4,652 (1,013) 3,639 Tradenames 3 years 3,100 (2,626) 474 3,100 (1,593) 1,507 Total Intangible Assets $ 158,867 $ (49,416) $ 109,451 $ 158,870 $ (29,116) $ 129,754 Solar Power Agreement (1) 17 years 13,747 (2,830) 10,917 13,747 (2,022) 11,725 Acquired Unfavorable Leases Acquired below market leases - as Lessor 3 to 4 years 809 (375) 434 809 (138) 671 Acquired above market leases - as Lessee 11 to 12 years 2,453 (550) 1,903 2,453 (334) 2,119 Total Intangible Liabilities (2) $ 17,009 $ (3,755) $ 13,254 $ 17,009 $ (2,494) $ 14,515 (1) Amortization related to the Solar Power Agreement asset and liability is recorded at the same rate and therefore has no net impact on the statement of operations. (2) Intangible liabilities are included within the “Advance rents, security deposits and other liabilities” line item of the consolidated balance sheets. |
Schedule of estimated amortization of acquired favorable and unfavorable leases | The estimated amortization of acquired favorable and unfavorable leases for each of the five succeeding fiscal years ending December 31 is as follows (in thousands): Net Rental Revenue Rental Expense 2018 $ 681 $ 216 2019 479 216 2020 647 216 2021 46 216 2022 17 216 Thereafter 17 823 Total $ 1,887 $ 1,903 |
Schedule of estimated amortization of all other identified intangible assets | The estimated net amortization of all other identified intangible assets and liabilities for each of the five succeeding fiscal years ending December 31 is as follows (in thousands): 2018 $ 14,574 2019 11,965 2020 11,379 2021 10,137 2022 9,910 Thereafter 38,248 Total $ 96,213 |
Real Estate Assets and Constr31
Real Estate Assets and Construction in Progress (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Real Estate Assets and Construction in Progress [Abstract] | |
Summary of Properties Owned or Leased by the Company | The following is a summary of properties owned or leased by the Company as of December 31, 2017 and 2016 (in thousands): As of December 31, 2017: Property Location Land Buildings and Improvements Construction Total Cost Atlanta, Georgia (Atlanta-Metro) $ 20,416 $ 452,836 $ 28,614 $ 501,866 Irving, Texas 8,606 276,894 86,320 371,820 Richmond, Virginia 2,180 254,603 61,888 318,671 Chicago, Illinois 9,400 81,463 135,479 226,342 Suwanee, Georgia (Atlanta-Suwanee) 3,521 165,915 3,620 173,056 Leased Facilities (1) — 59,460 5,534 64,994 Piscataway, New Jersey 7,466 83,251 37,807 128,524 Santa Clara, California (2) — 100,028 6,989 107,017 Sacramento, California 1,481 64,251 58 65,790 Fort Worth, Texas 9,079 17,894 33,774 60,747 Princeton, New Jersey 20,700 32,948 451 54,099 Dulles, Virginia 3,154 76,239 3,565 82,958 Ashburn, Virginia (3) — — 106,952 106,952 Phoenix, Arizona (3) — — 27,402 27,402 Hillsboro, Oregon (3) — — 29,278 29,278 Other (4) 2,213 35,505 88 37,806 $ 88,216 $ 1,701,287 $ 567,819 $ 2,357,322 (1) Includes 11 facilities. All facilities are leased, including those subject to capital leases. During the quarter ended March 31, 2017, the Company moved its Jersey City, NJ facility to the “Leased facilities” line item. During the quarter ended December 31, 2017, the Company completed the buyout of the Vault facility in Dulles, VA that was previously subject to a capital lease agreement, and as such, the facility was moved from the “Leased facilities” line item to a separate “Dulles, Virginia” line item. (2) Owned facility subject to long-term ground sublease. (3) Represent land purchases. Land acquisition costs, as well as subsequent development costs, are included within construction in progress until development on the land has ended and the asset is ready for its intended use. (4) Consists of Miami, FL; Lenexa, KS and Overland Park, KS facilities. During the quarter ended June 30, 2017, fixed assets and the associated accumulated depreciation related to the Duluth, GA facility (comprised of $1.9 million of land, $8.7 million of buildings, improvements, and equipment, and $0.1 million of construction in progress) were moved from Real Estate Assets, net to Other assets, net on the Consolidated Balance Sheet as the facility was transitioned to corporate office space. As of December 31, 2016: Property Location Land Buildings and Construction Total Cost Atlanta, Georgia (Atlanta-Metro) $ 15,397 $ 434,965 $ 32,422 $ 482,784 Irving, Texas 8,606 204,713 69,653 282,972 Richmond, Virginia 2,180 237,347 70,580 310,107 Chicago, Illinois 9,400 45,848 100,623 155,871 Suwanee, Georgia (Atlanta-Suwanee) 3,521 171,376 2,013 176,910 Leased Facilities (1) 1,130 116,290 10,003 127,423 Piscataway, New Jersey 7,466 82,210 17,261 106,937 Santa Clara, California (2) — 98,708 7,078 105,786 Sacramento, California 1,481 62,102 390 63,973 Fort Worth, Texas 136 610 49,116 49,862 Princeton, New Jersey 20,700 32,788 538 54,026 Other (3) 4,113 37,810 6,283 48,206 $ 74,130 $ 1,524,767 $ 365,960 $ 1,964,857 (1) Includes 12 facilities. All facilities are leased, including those subject to capital leases. During the quarter ended March 31, 2017, the Company moved its Jersey City, NJ facility to the “Leased facilities” line item, therefore has conformed December 31, 2016 information to comparable categories. (2) Owned facility subject to long-term ground sublease. (3) Consists of Miami, FL; Lenexa, KS, Overland Park, KS and Duluth, GA facilities. |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt [Abstract] | |
Outstanding Debt Including Capital Leases and Lease Financing Obligations | Below is a listing of the Company’s outstanding debt, including capital leases and lease financing obligations, as of December 31, 2017 and 2016 (in thousands): Weighted Average Coupon Interest Rate at Maturities as of December 31, December 31, December 31, 2017 December 31, 2017 2017 2016 Unsecured Credit Facility Revolving Credit Facility December 17, 2021 $ 131,000 $ 139,000 Term Loan I December 17, 2022 350,000 300,000 Term Loan II April 27, 2023 350,000 200,000 Senior Notes November 15, 2025 400,000 300,000 Lenexa Mortgage May 1, 2022 1,866 — Capital Lease and Lease Financing Obligations 2018 - 2019 8,699 38,708 1,241,565 977,708 Less discount and net debt issuance costs (11,636) (11,882) Total outstanding debt, net $ 1,229,929 $ 965,826 |
Annual Remaining Principal Payment | The annual remaining principal payment requirements as of December 31, 2017 per the contractual maturities and excluding extension options, capital leases and lease financing obligations, are as follows (in thousands): 2018 $ 65 2019 68 2020 71 2021 131,074 2022 350,077 Thereafter 751,511 Total $ 1,232,866 |
Schedule of Combined Future Payment Obligations, Excluding Interest | The following table summarizes the Company’s combined future payment obligations, excluding interest, as of December 31, 2017, on the capital leases and lease financing obligations described above (in thousands): 2018 $ 7,760 2019 939 2020 - 2021 - 2022 - Thereafter - Total $ 8,699 |
Partners' Capital, Equity and33
Partners' Capital, Equity and Incentive Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Partners' Capital, Equity and Incentive Compensation Plans [Abstract] | |
Summary of Award Activity Under 2010 Equity Incentive Plan and 2013 Equity Incentive Plan and Related Information | The following is a summary of award activity under the 2010 Equity Incentive Plan and 2013 Equity Incentive Plan and related information for the years ended December 31, 2017, 2016 and 2015: 2010 Equity Incentive Plan 2013 Equity Incentive Plan Weighted Weighted Weighted Weighted Weighted average Weighted average average Number of average Average fair Number of Grant date average fair Restricted Grant date Class O units exercise price value Class RS units value Options exercise price value Stock value Outstanding at January 1, 2015 1,518,717 $ 23.49 $ 3.75 74,625 $ 23.49 584,949 $ 22.87 $ 4.10 246,785 $ 29.13 Granted — — — — — 317,497 36.16 8.03 230,271 36.71 Exercised/Vested (1) (222,499) 22.02 4.18 — — (23,157) 21.30 3.63 (54,400) 28.37 Released from restriction (2) — — — (34,750) 25.00 — — — — — Cancelled/Expired (3) (3,319) 20.00 3.92 — — (11,407) 21.00 3.52 (27,748) 28.33 Outstanding at December 31, 2015 1,292,899 $ 23.76 $ 3.68 39,875 $ 22.18 867,882 $ 27.80 $ 5.56 394,908 $ 33.82 Granted — — — — — 229,693 45.78 9.91 237,563 45.53 Exercised/Vested (1) (158,088) 21.56 4.18 — — (29,543) 25.70 4.96 (122,136) 33.26 Released from restriction (2) — — — (39,875) 22.18 — — — — — Cancelled/Expired (3) — — — — — (9,735) 32.14 6.95 (95,644) 33.92 Outstanding at December 31, 2016 1,134,811 $ 24.06 $ 3.62 — $ — 1,058,297 $ 31.72 $ 6.51 414,691 $ 40.67 Granted — — — — — 468,875 50.66 10.32 228,576 49.86 Exercised/Vested (1) (566,771) 24.60 2.24 — — (155,902) 31.89 6.60 (163,048) 40.63 Cancelled/Expired (3) — — — — — (2,000) 37.69 8.77 (98,355) 39.97 Outstanding at December 31, 2017 568,040 $ 23.52 $ 5.00 — $ — 1,369,270 $ 38.18 $ 7.80 381,864 $ 46.37 (1) This represents the Class A common stock that has been released from restriction and which was not surrendered by the holder to satisfy their statutory minimum federal and state tax obligations associated with the vesting of restricted common stock. This also represents Class O units which were converted to Class A units and Options to purchase Class A common stock which were exercised for their respective columns. (2) This represents Class RS units that upon vesting have converted to Operating Partnership units. (3) Includes restricted Class A common stock surrendered by certain employees to satisfy their statutory minimum federal and state tax obligations associated with the vesting of restricted common stock. |
Summary of Assumptions and Fair Values for Restricted Stock and Options to Purchase Shares of Class A Common Stock Granted | 2017 2016 2015 Fair value of restricted stock granted $48.63 - $51.88 $45.78 - $56.28 $35.81 - $37.69 Fair value of options granted $10.11 - $10.36 $9.57 - $9.97 $8.00 - $8.77 Expected term (years) 5.5 - 5.9 5.5 - 5.9 5.5 - 6.1 Expected volatility 30.7% - 31.3% Expected dividend yield 3.40% - 3.57% Expected risk-free interest rates 2.12% - 2.18% 1.42% - 1.48% 1.67% - 1.94% |
Summary of Information About Awards Outstanding | The following tables summarize information about awards outstanding as of December 31, 2017. Operating Partnership Awards Outstanding Weighted average Awards remaining Exercise prices outstanding vesting period (years) Class O Units $ 20.00 - 25.00 568,040 — Total Operating Partnership awards outstanding 568,040 QTS Realty Trust, Inc. Awards Outstanding Weighted average Awards remaining Exercise prices outstanding vesting period (years) Restricted stock $ — 381,864 1.7 Options to purchase Class A common stock $ 21.00 - 50.66 1,369,270 0.8 Total QTS Realty Trust, Inc. awards outstanding 1,751,134 |
Schedule of Quarterly Cash Dividends | Year Ended December 31, 2017 Aggregate Per Common Share and Dividend/Distribution Record Date Payment Date Per Unit Rate Amount (in millions) September 22, 2017 October 5, 2017 $ 0.39 $ 22.2 June 16, 2017 July 6, 2017 0.39 21.6 March 16, 2017 April 5, 2017 0.39 21.4 December 16, 2016 January 5, 2017 0.36 19.7 $ 1.53 $ 84.9 Year Ended December 31, 2016 Aggregate Per Common Share and Dividend/Distribution Record Date Payment Date Per Unit Rate Amount (in millions) September 20, 2016 October 5, 2016 $ 0.36 $ 19.7 June 17, 2016 July 6, 2016 0.36 19.7 March 18, 2016 April 5, 2016 0.36 17.4 December 17, 2015 January 6, 2016 0.32 15.4 $ 1.40 $ 72.2 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Summary of Related Party Transactions | The transactions which occurred during the years ended December 31, 2017, 2016 and 2015 are outlined below (in thousands): December 31, (dollars in thousands) 2017 2016 2015 Tax, utility, insurance and other reimbursement $ 796 $ 878 $ 589 Rent expense 1,014 1,014 1,014 Capital assets acquired 561 323 261 Total $ 2,371 $ 2,215 $ 1,864 |
Earnings per share of QTS Rea35
Earnings per share of QTS Realty Trust, Inc. (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings per Share [Abstract] | |
Summary of Basic and Diluted Earnings Per Share | The computation of basic and diluted net income per share is as follows (in thousands, except per share data): Year Ended December 31, 2017 2016 2015 Numerator: Net income available to common stockholders - basic $ 1,282 $ 21,525 $ 20,326 Effect of net income attributable to noncontrolling interests and income allocated to participating securities Net income available to common stockholders $ 689 $ 24,685 $ 24,129 Denominator: Weighted average shares outstanding - basic Effect of Class A and Class RS partnership units * Effect of Class O units and options to purchase Class A common stock and restricted Class A common stock on an "as if" converted basis * 779 Weighted average shares outstanding - diluted 55,856 Basic net income per share $ 0.01 $ 0.47 $ 0.54 Diluted net income per share $ 0.01 $ 0.46 $ 0.53 * The Class A units and Class O units represent limited partnership interests in the Operating Partnership, and are described in more detail in Note 8 |
Operating Leases, as Lessee (Ta
Operating Leases, as Lessee (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Leases [Abstract] | |
Future Non-cancellable Minimum Rental Payments Required Under Operating Leases and/or Licenses | The future non-cancellable minimum rental payments required under operating leases and/or licenses at December 31, 2017 are as follows (in thousands): Year Ending December 31, 2018 $ 15,031 2019 10,259 2020 9,894 2021 9,931 2022 9,675 Thereafter 65,126 Total $ 119,916 |
Customer Leases, as Lessor (Tab
Customer Leases, as Lessor (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Leases [Abstract] | |
Future Minimum Lease Payments to be Received Under Non-Cancelable Operating Customer Leases | Future minimum lease payments to be received under non-cancelable operating customer leases (inclusive of payments for contracts which have not yet commenced and exclusive of recoveries of operating costs from customers) are as follows for the years ending December 31 (in thousands): Year Ending December 31, 2018 $ 334,594 2019 239,485 2020 172,280 2021 130,969 2022 84,660 Thereafter 82,873 Total $ 1,044,861 |
Quarterly Financial Informati38
Quarterly Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Selected Quarterly Information | The tables below reflect the selected quarterly information for the years ended December 31, 2017 and 2016 for QTS (in thousands except share data): + Three Months Ended December 31, September 30, June 30, March 31, 2017 Revenues $ 118,911 $ 113,767 $ 107,868 $ 105,964 Operating income 7,553 12,833 10,826 10,915 Net income (loss) (16,113) 7,394 4,608 5,568 Net income (loss) attributable to common shares (14,142) 6,507 4,040 4,877 Net income (loss) per share attributable to common shares - basic (0.29) 0.13 0.08 0.10 Net income (loss) per share attributable to common shares - diluted (0.29) 0.13 0.08 0.10 2016 Revenues $ 105,443 $ 103,465 $ 98,687 $ 94,768 Operating income 11,092 8,505 8,225 10,235 Net income 5,481 6,538 5,807 6,859 Net income attributable to common shares 4,806 5,730 5,100 5,889 Net income per share attributable to common shares - basic 0.10 0.12 0.11 0.14 Net income per share attributable to common shares - diluted 0.10 0.12 0.10 0.14 |
Qualitytech, LP | |
Summary of Selected Quarterly Information | The table below reflects the selected quarterly information for the years ended December 31, 2017 and 2016 for the Operating Partnership (in thousands): Three Months Ended December 31, September 30, June 30, March 31, 2017 Revenues $ 118,911 $ 113,767 $ 107,868 $ 105,964 Operating income 7,553 12,833 10,826 10,915 Net income (loss) (16,113) 7,394 4,608 5,568 2016 Revenues $ 105,443 $ 103,465 $ 98,687 $ 94,768 Operating income 11,092 8,505 8,225 10,235 Net income 5,481 6,538 5,807 6,859 |
Description of Business (Narrat
Description of Business (Narrative) (Details) | 12 Months Ended | ||
Dec. 31, 2017property$ / sharesshares | Dec. 31, 2016$ / sharesshares | May 17, 2013$ / sharesshares | |
Organization And Description Of Business [Line Items] | |||
Number of properties | property | 25 | ||
Common stock, shares issued | shares | 50,701,795 | 47,831,250 | |
Common stock, par value | $ / shares | $ 0.01 | $ 0.01 | |
Class A Common Stock | |||
Organization And Description Of Business [Line Items] | |||
Common stock, shares issued | shares | 14,087,500 | ||
Common stock, par value | $ / shares | $ 0.01 | ||
QualityTech LP | |||
Organization And Description Of Business [Line Items] | |||
Limited Liability Company (LLC) or Limited Partnership (LP), Managing Member or General Partner, Ownership Interest | 88.60% |
Summary of Significant Accoun40
Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Summary Of Significant Accounting Policies [Line Items] | |||
Aggregate principal amount | $ 19,900 | ||
Payment of minimum tax withholdings related to equity based awards | 4,725 | $ 2,584 | $ 1,088 |
Proceeds from exercise of stock options | $ 4,972 | 858 | 559 |
Useful life of property | 40 years | ||
Increase Decrease In Accounts Payable And Accrued Liabilities | $ (5,071) | 6,290 | 9,467 |
Depreciation expense from operation | 104,300 | 90,600 | 65,000 |
Real estate cost capitalized excluding interest cost | 12,700 | 11,000 | 10,800 |
Real estate interest cost capitalized incurred | 14,300 | 11,400 | 9,800 |
Qualitytech, LP | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Payment of minimum tax withholdings related to equity based awards | 4,725 | 2,584 | 1,088 |
Proceeds from exercise of stock options | 4,972 | 858 | 559 |
Increase Decrease In Accounts Payable And Accrued Liabilities | (5,071) | 6,290 | 9,467 |
Real Estate Assets | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Depreciation expense from operation | 90,100 | 77,500 | 55,200 |
Non-Real Estate Assets | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Depreciation expense from operation | $ 14,200 | 13,100 | 9,800 |
Minimum | Real Property | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Useful life of property | 20 years | ||
Maximum | Real Property | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Useful life of property | 40 years | ||
Maximum | Leasehold Improvements | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Useful life of property | 20 years | ||
Cash Inflows | Accounting Standards Update 2016-09 [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Proceeds from exercise of stock options | $ 900 | 600 | |
Increase Decrease In Accounts Payable And Accrued Liabilities | (600) | ||
Cash Outflows | Accounting Standards Update 2016-09 [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Payment of minimum tax withholdings related to equity based awards | $ 900 | 1,100 | |
Increase Decrease In Accounts Payable And Accrued Liabilities | $ (1,100) | ||
Term Loan Maturing 2022 | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Interest rate | 5.875% | ||
Aggregate principal amount | $ 300,000 | ||
Term Loan Maturing 2025 | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Interest rate | 4.75% | ||
Aggregate principal amount | $ 400,000 |
Summary of Significant Accoun41
Summary of Significant Accounting Policies (Additional Information 1) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Summary Of Significant Accounting Policies [Line Items] | |||
Impairment losses | $ 1,600 | $ 0 | $ 0 |
Goodwill | 173,843 | 173,843 | |
Amortization of the deferred financing costs | 3,640 | 3,285 | 3,181 |
Written off unamortized debt cost | 500 | ||
Amortization of deferred leasing costs total | 18,500 | 15,200 | 11,800 |
Deferred income | 25,305 | 21,993 | 17,000 |
Amortization of deferred revenue | 10,700 | 9,400 | 6,000 |
Company recorded equity-based compensation expense net of repurchased awards and forfeits | 13,900 | 10,600 | 7,000 |
Amount of the straight-line rent receivable on the balance sheets included in rents and other receivables, net | 23,400 | 17,300 | |
Unsecured Revolving Credit Facility | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Amortization of the deferred financing costs | 3,600 | 3,300 | $ 3,200 |
Written off unamortized debt cost | $ 5,200 | $ 200 |
Summary of Significant Accoun42
Summary of Significant Accounting Policies (Deferred Financing Costs, Net of Accumulated Amortization) (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred financing costs | $ 9,775 | $ 7,128 |
Accumulated amortization | (1,908) | (145) |
Deferred financing costs, net | 7,867 | 6,983 |
Fixed debt arrangements | ||
Deferred financing costs | 12,675 | 12,779 |
Accumulated amortization | (1,039) | (2,660) |
Deferred financing costs, net | $ 11,636 | $ 10,119 |
Summary of Significant Accoun43
Summary of Significant Accounting Policies (Deferred Leasing Costs, Net of Accumulated Amortization) (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Summary of Significant Accounting Policies [Abstract] | ||
Deferred leasing costs | $ 54,868 | $ 50,026 |
Accumulated amortization | (20,956) | (18,502) |
Deferred leasing costs, net | $ 33,912 | $ 31,524 |
Summary of Significant Accoun44
Summary of Significant Accounting Policies (Additional Information 2) (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017USD ($)segmententity | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Apr. 05, 2017USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | ||||
Aggregate allowance for doubtful accounts | $ 11,500 | $ 4,200 | ||
Capital lease obligations | 7,800 | 18,100 | ||
Lease financing obligations | 900 | 20,600 | ||
Net book value of assets associated with leases | $ 14,700 | 41,500 | ||
Number of operating segments | segment | 1 | |||
Number of reportable segments | segment | 1 | |||
Valuation allowance | $ 713 | 393 | $ 393 | |
Financial assets | 0 | |||
Financial liability | 0 | |||
Net operating loss carry forwards related to Federal income taxes | 33,900 | |||
Net operating loss carry forwards related to State income taxes | 35,800 | |||
Unrecognized Tax Benefits | 0 | 0 | 0 | |
Interest and penalties related to income taxes | $ 0 | $ 0 | $ 0 | |
Number of subsidiaries taxed as taxable REIT | entity | 2 | |||
Effective tax rate | 65.10% | 46.50% | 34.80% | |
Alternative minimum tax | $ 300 | |||
One-time non-cash income tax benefit of $3.4 million to reflect the re-measurement of deferred tax assets (liabilities) | 3,300 | |||
Debt Instrument Face Amount | 19,900 | |||
Term Loan Maturing 2022 | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Debt Instrument Face Amount | 300,000 | |||
Term Loan Maturing 2025 | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Debt Instrument Face Amount | $ 400,000 | |||
Interest Rate Swap | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Derivative instruments, notional amount | $ 400,000 | |||
Interest Rate Swap | Term Loan | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Debt Instrument Face Amount | 400,000 | |||
Interest Rate Swap | Term Loan Maturing December 17,2021 | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Derivative instruments, notional amount | 200,000 | |||
Interest Rate Swap | Term Loan Maturing April 27, 2022 | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Derivative instruments, notional amount | $ 200,000 | |||
Minimum | Federal [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Net operating loss carry forwards, expiration period | 12 years | |||
Minimum | State [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Net operating loss carry forwards, expiration period | 2 years | |||
Maximum | Federal [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Net operating loss carry forwards, expiration period | 20 years | |||
Maximum | State [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Net operating loss carry forwards, expiration period | 20 years | |||
Customer One | Rental Revenue | Maximum | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Percentage of total revenue | 11.80% | |||
Other Customers [Member] | Rental Revenue | Maximum | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Percentage of total revenue | 4.50% | |||
Five Customers | Accounts Receivable | Minimum | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Percentage of total accounts receivable | 5.00% | |||
Five Customers | Accounts Receivable | Maximum | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Percentage of total accounts receivable | 33.00% | |||
Customer None | Accounts Receivable | Minimum | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Percentage of total accounts receivable | 10.00% |
Summary of Significant Accoun45
Summary of Significant Accounting Policies (Income Taxes ) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||
U.S federal | $ 42 | $ (356) | $ 462 |
U.S. State | 297 | 20 | 11 |
Outside United States | 44 | 33 | |
Total Current | 383 | (303) | 473 |
Deferred: | |||
U.S federal | (9,734) | (8,796) | (8,952) |
U.S. State | (427) | (877) | (1,586) |
Total Deferred | (10,161) | (9,673) | (10,538) |
Total | $ (9,778) | $ (9,976) | $ (10,065) |
Summary of Significant Accoun46
Summary of Significant Accounting Policies (Schedule of Differences between Total Income Tax or Benefit and Amount Computed by Applying the Statutory Income Tax Rate) (Details) - USD ($) $ in Thousands | Jan. 01, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Statutory rate of 34% applied to pre-tax loss | $ (5,109) | $ (7,299) | $ (6,683) | |
Permanent differences, net | (284) | (2,021) | 281 | |
State income tax, net of federal benefit | (388) | (689) | (268) | |
Foreign income tax | 44 | 33 | ||
Federal rate change | (3,251) | |||
Contribution of Assets to TRS | (866) | |||
Other | (244) | |||
Valuation allowance (decrease) increase | 320 | (3,395) | ||
Total tax benefit | $ (9,778) | $ (9,976) | $ (10,065) | |
Effective tax rate | 65.10% | 46.50% | 34.80% | |
Statutory rate | 21.00% | 34.00% | ||
Maximum | ||||
Statutory rate | 35.00% |
Summary of Significant Accoun47
Summary of Significant Accounting Policies (Summary of Temporary Differences and Carry Forwards Which Give Rise to Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax liabilities | |||
Property and equipment | $ (4,940) | $ (15,031) | $ (16,032) |
Goodwill | (1,396) | (1,290) | (407) |
Intangibles | (13,606) | (24,244) | (23,896) |
Other | (1,132) | (1,386) | (2,350) |
Gross deferred tax liabilities | (21,074) | (41,951) | (42,685) |
Deferred tax assets | |||
Net operating loss carryforwards | 8,888 | 18,035 | 14,500 |
Deferred revenue and setup charges | 3,435 | 4,323 | 3,747 |
Leases | 453 | 2,154 | 3,097 |
Credits | 543 | 492 | 630 |
Bad debt reserve | 2,250 | 41 | 539 |
Other | 1,607 | 2,114 | 1,752 |
Gross deferred tax assets | 17,176 | 27,159 | 24,265 |
Net deferred tax liability | 3,898 | 14,792 | 18,420 |
Valuation allowance | (713) | (393) | (393) |
Net deferred tax liability | $ 4,611 | $ 15,185 | $ 18,813 |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) $ in Thousands | Oct. 06, 2017USD ($)ft²MW | Dec. 16, 2016USD ($)MW | Dec. 31, 2017USD ($) | Dec. 31, 2015USD ($) | Dec. 16, 2016ft² | Dec. 16, 2016a | Jun. 06, 2016ft²aMW |
Business Acquisition [Line Items] | |||||||
Capital lease and lease financing obligations assumed | $ | $ 43,832 | ||||||
Fort Worth Facility | |||||||
Business Acquisition [Line Items] | |||||||
Acquisition costs | $ | $ 50,100 | ||||||
Area of facility (in square feet) | 262,000 | 53 | |||||
Capacity of the plant (in MW) | MW | 50 | ||||||
Fort Worth Facility | Basis Of Design | |||||||
Business Acquisition [Line Items] | |||||||
Area of facility (in square feet) | ft² | 80,000 | ||||||
Piscataway Facility | |||||||
Business Acquisition [Line Items] | |||||||
Acres of real estate property | a | 38 | ||||||
Area of facility (in square feet) | ft² | 360,000 | ||||||
Piscataway Facility | Raised Floor With 18 MW of Critical Power | |||||||
Business Acquisition [Line Items] | |||||||
Area of facility (in square feet) | ft² | 89,000 | ||||||
Capacity of the plant (in MW) | MW | 18 | ||||||
Piscataway Facility | Additional Raised Floor With 8 MW of Additional Critical Power | |||||||
Business Acquisition [Line Items] | |||||||
Area of facility (in square feet) | ft² | 87,000 | ||||||
Capacity of the plant (in MW) | MW | 8 | ||||||
Carpathia Hosting, Inc. | |||||||
Business Acquisition [Line Items] | |||||||
Capital lease and lease financing obligations assumed | $ | $ 5,700 | ||||||
Vault Campus in Dulles, Virginia | |||||||
Business Acquisition [Line Items] | |||||||
Area of facility (in square feet) | ft² | 87,000 | ||||||
Capital lease and lease financing obligations assumed | $ | $ 17,800 | ||||||
Purchase price of land | $ | 34,100 | ||||||
Net Purchase Price of Buyout Lease | $ | $ 16,300 | ||||||
Vault Campus in Dulles, Virginia | Raised Floor With 13 MW of Critical Power | |||||||
Business Acquisition [Line Items] | |||||||
Area of facility (in square feet) | ft² | 31,000 | ||||||
Capacity of the plant (in MW) | MW | 13 |
Acquisitions (Allocation of the
Acquisitions (Allocation of the Fair Value of Assets Acquired and Liabilities Assumed as of the Acquisition Date) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | |
Business Acquisition [Line Items] | |||||
Land | $ 9,363 | $ 7,602 | $ 3,030 | ||
Buildings and improvements | 14,341 | 80,975 | 80,818 | ||
Construction in Progress | 103,334 | 62,884 | 12,127 | ||
Deferred costs | 4,414 | ||||
Other assets | 309 | 633 | |||
Capital lease and lease financing obligations | $ 43,832 | ||||
Fort Worth Facility | |||||
Business Acquisition [Line Items] | |||||
Land | 136 | ||||
Buildings and improvements | 610 | ||||
Construction in Progress | 48,987 | ||||
Acquired intangibles | 237 | ||||
Deferred costs | 23 | ||||
Other assets | 7 | ||||
Net working capital | 86 | ||||
Net identifiable assets acquired | 50,086 | ||||
Fort Worth Facility | Preliminary Allocation Reported | |||||
Business Acquisition [Line Items] | |||||
Land | 136 | ||||
Buildings and improvements | 610 | ||||
Construction in Progress | 48,984 | ||||
Acquired intangibles | 240 | ||||
Deferred costs | 23 | ||||
Other assets | 7 | ||||
Net working capital | 86 | ||||
Net identifiable assets acquired | $ 50,086 | ||||
Fort Worth Facility | Adjustment | |||||
Business Acquisition [Line Items] | |||||
Construction in Progress | 3 | ||||
Acquired intangibles | (3) | ||||
Piscataway Facility | |||||
Business Acquisition [Line Items] | |||||
Land | $ 7,466 | ||||
Buildings and improvements | 80,366 | ||||
Construction in Progress | 13,900 | ||||
Acquired intangibles | 19,581 | ||||
Deferred costs | 4,390 | ||||
Other assets | 106 | ||||
Total identifiable assets acquired | 125,809 | ||||
Acquired above market lease | 809 | ||||
Net working capital | 2,019 | ||||
Total liabilities assumed | 2,828 | ||||
Net identifiable assets acquired | $ 122,981 | ||||
Measurement period adjustments | 0 | ||||
Piscataway Facility | Preliminary Allocation Reported | |||||
Business Acquisition [Line Items] | |||||
Land | $ 7,440 | ||||
Buildings and improvements | 78,370 | ||||
Construction in Progress | 13,900 | ||||
Acquired intangibles | 21,668 | ||||
Deferred costs | 4,084 | ||||
Other assets | 106 | ||||
Total identifiable assets acquired | 125,568 | ||||
Acquired above market lease | 568 | ||||
Net working capital | 2,019 | ||||
Total liabilities assumed | 2,587 | ||||
Net identifiable assets acquired | $ 122,981 | ||||
Piscataway Facility | Adjustment | |||||
Business Acquisition [Line Items] | |||||
Land | 26 | ||||
Buildings and improvements | 1,996 | ||||
Acquired intangibles | (2,087) | ||||
Deferred costs | 306 | ||||
Total identifiable assets acquired | 241 | ||||
Acquired above market lease | 241 | ||||
Total liabilities assumed | $ 241 |
Acquisitions (Land Acquisitions
Acquisitions (Land Acquisitions) (Details) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Oct. 31, 2017USD ($)a | Aug. 31, 2017USD ($)a | Jul. 31, 2017USD ($)a | Dec. 31, 2017USD ($)item | |
Property, Plant and Equipment [Line Items] | ||||
Number of acquisitions | item | 4 | |||
Land in Ashburn, Virginia | ||||
Property, Plant and Equipment [Line Items] | ||||
Acres of land | a | 28 | 24 | ||
Payments to Acquire Land | $ 36 | $ 17 | ||
Phoenix Arizona Land | ||||
Property, Plant and Equipment [Line Items] | ||||
Acres of land | a | 84 | |||
Payments to Acquire Land | $ 25 | |||
Land in Hillsboro, Oregon | ||||
Property, Plant and Equipment [Line Items] | ||||
Acres of land | a | 92 | |||
Payments to Acquire Land | $ 26 | |||
Phoenix Arizona And Ashburn Virginia And Hillsboro Oregon [Member] | Construction in Progress | ||||
Property, Plant and Equipment [Line Items] | ||||
Fair value of land acquired | $ 163.6 |
Acquired Intangibles Assets a51
Acquired Intangibles Assets and Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | 24 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | |
Finite-lived intangible assets | |||
Gross Carrying Value | $ 158,867 | $ 158,870 | $ 158,867 |
Accumulated Amortization | (49,416) | (29,116) | (49,416) |
Net Carrying Value | 109,451 | 129,754 | 109,451 |
Acquired below market leases - as Lessor | |||
Gross Carrying Value | 809 | 809 | 809 |
Accumulated Amortization | (375) | (138) | (375) |
Net Carrying Value | 434 | 671 | 434 |
Acquired above market leases - as Lessee | |||
Gross Carrying Value | 2,453 | 2,453 | 2,453 |
Accumulated Amortization | (550) | (334) | (550) |
Total | 1,903 | 2,119 | 1,903 |
Acquired Intangible Liabilities | |||
Acquired intangible liabilities | 17,009 | 17,009 | 17,009 |
Accumulated Amortization | (3,755) | (2,494) | (3,755) |
New Carrying Value | $ 13,254 | $ 14,515 | 13,254 |
Minimum | |||
Acquired below market leases - as Lessor | |||
Useful Lives | 3 years | 3 years | |
Acquired above market leases - as Lessee | |||
Useful Lives | 11 years | 11 years | |
Maximum | |||
Acquired below market leases - as Lessor | |||
Useful Lives | 4 years | 4 years | |
Acquired above market leases - as Lessee | |||
Useful Lives | 12 years | 12 years | |
Customer Relationships | |||
Finite-lived intangible assets | |||
Gross Carrying Value | $ 95,705 | $ 95,705 | 95,705 |
Accumulated Amortization | (20,512) | (12,358) | (20,512) |
Net Carrying Value | $ 75,193 | $ 83,347 | $ 75,193 |
Customer Relationships | Minimum | |||
Finite-lived intangible assets | |||
Useful Lives | 1 year | 1 year | |
Customer Relationships | Maximum | |||
Finite-lived intangible assets | |||
Useful Lives | 12 years | ||
In Place Leases | |||
Finite-lived intangible assets | |||
Gross Carrying Value | $ 32,066 | $ 32,066 | $ 32,066 |
Accumulated Amortization | (12,987) | (7,197) | (12,987) |
Net Carrying Value | $ 19,079 | $ 24,869 | 19,079 |
In Place Leases | Minimum | |||
Finite-lived intangible assets | |||
Useful Lives | 6 months | 6 months | |
In Place Leases | Maximum | |||
Finite-lived intangible assets | |||
Useful Lives | 10 years | 10 years | |
Platform Intangible | |||
Finite-lived intangible assets | |||
Useful Lives | 3 years | 3 years | |
Gross Carrying Value | $ 9,600 | $ 9,600 | 9,600 |
Accumulated Amortization | (8,133) | (4,933) | (8,133) |
Net Carrying Value | 1,467 | 4,667 | 1,467 |
Acquired favorable leases | |||
Finite-lived intangible assets | |||
Gross Carrying Value | 4,649 | 4,652 | 4,649 |
Accumulated Amortization | (2,328) | (1,013) | (2,328) |
Net Carrying Value | $ 2,321 | $ 3,639 | 2,321 |
Acquired favorable leases | Minimum | |||
Finite-lived intangible assets | |||
Useful Lives | 6 months | 6 months | |
Acquired favorable leases | Maximum | |||
Finite-lived intangible assets | |||
Useful Lives | 8 years | 8 years | |
Tradenames | |||
Finite-lived intangible assets | |||
Useful Lives | 3 years | 3 years | |
Gross Carrying Value | $ 3,100 | $ 3,100 | 3,100 |
Accumulated Amortization | (2,626) | (1,593) | (2,626) |
Net Carrying Value | $ 474 | $ 1,507 | 474 |
Solar Power Agreement | |||
Finite-lived intangible assets | |||
Useful Lives | 17 years | 17 years | |
Gross Carrying Value | $ 13,747 | $ 13,747 | 13,747 |
Accumulated Amortization | (2,830) | (2,022) | (2,830) |
Net Carrying Value | $ 10,917 | $ 11,725 | $ 10,917 |
Acquired Intangibles Assets a52
Acquired Intangibles Assets and Liabilities - Amortization (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Acquired Intangible Assets and Liabilities | |||
Amortization of acquired above and below-market leases, net | $ 865 | $ 659 | $ (117) |
Total | 1,903 | 2,119 | |
Amortization of all other identified intangible assets | 18,200 | 19,000 | $ 9,000 |
Estimated amortization of all other identified intangible assets | |||
Net Carrying Value | 109,451 | $ 129,754 | |
Acquired favorable and unfavorable leases | |||
Acquired Intangible Assets and Liabilities | |||
Total | 1,903 | ||
Estimated amortization of acquired favorable and unfavorable leases Rental Revenue | |||
2,018 | 681 | ||
2,019 | 479 | ||
2,020 | 647 | ||
2,021 | 46 | ||
2,022 | 17 | ||
Thereafter | 17 | ||
Total | 1,887 | ||
Estimated amortization of acquired favorable and unfavorable leases Rental Expense | |||
2,018 | 216 | ||
2,019 | 216 | ||
2,020 | 216 | ||
2,021 | 216 | ||
2,022 | 216 | ||
Thereafter | 823 | ||
All other identified intangible assets | |||
Estimated amortization of all other identified intangible assets | |||
2,018 | 14,574 | ||
2,019 | 11,965 | ||
2,020 | 11,379 | ||
2,021 | 10,137 | ||
2,022 | 9,910 | ||
Thereafter | 38,248 | ||
Net Carrying Value | $ 96,213 |
Real Estate Assets and Constr53
Real Estate Assets and Construction in Progress (Summary of Properties Owned or Leased by the Company) (Details) $ in Thousands | Dec. 31, 2017USD ($)property | Jun. 30, 2017USD ($) | Dec. 31, 2016USD ($)property |
Real Estate Properties [Line Items] | |||
Land | $ 88,216 | $ 74,130 | |
Buildings and improvements | 1,701,287 | 1,524,767 | |
Construction in progress | 567,819 | 365,960 | |
Total cost | $ 2,357,322 | $ 1,964,857 | |
Number of facilities leased | property | 11 | 12 | |
Duluth, Georgia | Other Assets. | |||
Real Estate Properties [Line Items] | |||
Land | $ 1,900 | ||
Buildings and improvements | 8,700 | ||
Construction in progress | $ 100 | ||
Owned Properties | Atlanta, Georgia (Atlanta-Metro) | |||
Real Estate Properties [Line Items] | |||
Land | $ 20,416 | $ 15,397 | |
Buildings and improvements | 452,836 | 434,965 | |
Construction in progress | 28,614 | 32,422 | |
Total cost | 501,866 | 482,784 | |
Owned Properties | Irving Texas | |||
Real Estate Properties [Line Items] | |||
Land | 8,606 | 8,606 | |
Buildings and improvements | 276,894 | 204,713 | |
Construction in progress | 86,320 | 69,653 | |
Total cost | 371,820 | 282,972 | |
Owned Properties | Richmond, Virginia | |||
Real Estate Properties [Line Items] | |||
Land | 2,180 | 2,180 | |
Buildings and improvements | 254,603 | 237,347 | |
Construction in progress | 61,888 | 70,580 | |
Total cost | 318,671 | 310,107 | |
Owned Properties | Chicago, Illinois | |||
Real Estate Properties [Line Items] | |||
Land | 9,400 | 9,400 | |
Buildings and improvements | 81,463 | 45,848 | |
Construction in progress | 135,479 | 100,623 | |
Total cost | 226,342 | 155,871 | |
Owned Properties | Suwanee, Georgia (Atlanta-Suwanee) | |||
Real Estate Properties [Line Items] | |||
Land | 3,521 | 3,521 | |
Buildings and improvements | 165,915 | 171,376 | |
Construction in progress | 3,620 | 2,013 | |
Total cost | 173,056 | 176,910 | |
Owned Properties | Piscataway New Jersey | |||
Real Estate Properties [Line Items] | |||
Land | 7,466 | 7,466 | |
Buildings and improvements | 83,251 | 82,210 | |
Construction in progress | 37,807 | 17,261 | |
Total cost | 128,524 | 106,937 | |
Owned Properties | Santa Clara, California | |||
Real Estate Properties [Line Items] | |||
Buildings and improvements | 100,028 | 98,708 | |
Construction in progress | 6,989 | 7,078 | |
Total cost | 107,017 | 105,786 | |
Owned Properties | Sacramento, California | |||
Real Estate Properties [Line Items] | |||
Land | 1,481 | 1,481 | |
Buildings and improvements | 64,251 | 62,102 | |
Construction in progress | 58 | 390 | |
Total cost | 65,790 | 63,973 | |
Owned Properties | Fort Worth, Texas | |||
Real Estate Properties [Line Items] | |||
Land | 9,079 | 136 | |
Buildings and improvements | 17,894 | 610 | |
Construction in progress | 33,774 | 49,116 | |
Total cost | 60,747 | 49,862 | |
Owned Properties | Princeton, New Jersey | |||
Real Estate Properties [Line Items] | |||
Land | 20,700 | 20,700 | |
Buildings and improvements | 32,948 | 32,788 | |
Construction in progress | 451 | 538 | |
Total cost | 54,099 | 54,026 | |
Owned Properties | Dulles, Virginia | |||
Real Estate Properties [Line Items] | |||
Land | 3,154 | ||
Buildings and improvements | 76,239 | ||
Construction in progress | 3,565 | ||
Total cost | 82,958 | ||
Owned Properties | Ashburn, Virginia | |||
Real Estate Properties [Line Items] | |||
Construction in progress | 106,952 | ||
Total cost | 106,952 | ||
Owned Properties | Phoenix, Arizona | |||
Real Estate Properties [Line Items] | |||
Construction in progress | 27,402 | ||
Total cost | 27,402 | ||
Owned Properties | Hillsboro, Oregon | |||
Real Estate Properties [Line Items] | |||
Construction in progress | 29,278 | ||
Total cost | 29,278 | ||
Owned Properties | Other | |||
Real Estate Properties [Line Items] | |||
Land | 2,213 | 4,113 | |
Buildings and improvements | 35,505 | 37,810 | |
Construction in progress | 88 | 6,283 | |
Total cost | 37,806 | 48,206 | |
Leased Properties | Owned Properties | |||
Real Estate Properties [Line Items] | |||
Land | 1,130 | ||
Buildings and improvements | 59,460 | 116,290 | |
Construction in progress | 5,534 | 10,003 | |
Total cost | $ 64,994 | $ 127,423 |
Debt (Outstanding Debt Includin
Debt (Outstanding Debt Including Capital Leases) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||
Weighted average coupon interest rate | 3.48% | |
Total debt and lease obligations | $ 1,241,565 | $ 977,708 |
Less discount and debt issuance costs | (11,636) | (11,882) |
Total outstanding debt, net | $ 1,229,929 | 965,826 |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Weighted average coupon interest rate | 2.85% | |
Maturity date | Dec. 17, 2021 | |
Outstanding debt | $ 131,000 | 139,000 |
Term Loan I [Member] | ||
Debt Instrument [Line Items] | ||
Weighted average coupon interest rate | 2.88% | |
Maturity date | Dec. 17, 2022 | |
Outstanding debt | $ 350,000 | 300,000 |
Term Loan II [Member] | ||
Debt Instrument [Line Items] | ||
Weighted average coupon interest rate | 2.91% | |
Maturity date | Apr. 27, 2023 | |
Outstanding debt | $ 350,000 | 200,000 |
Operating Partnership Quality Tech LP And QTS Finance Corporation [Member] | ||
Debt Instrument [Line Items] | ||
Weighted average coupon interest rate | 4.75% | |
Maturity date | Nov. 15, 2025 | |
Outstanding debt | $ 400,000 | |
Operating Partnership And QTS Finance Corporation | ||
Debt Instrument [Line Items] | ||
Maturity date | Aug. 1, 2022 | |
Outstanding debt | 300,000 | |
Lenexa Mortgage | ||
Debt Instrument [Line Items] | ||
Weighted average coupon interest rate | 4.10% | |
Maturity date | May 1, 2022 | |
Outstanding debt | $ 1,866 | |
Capital Lease and Lease Financing Obligations [Member] | ||
Debt Instrument [Line Items] | ||
Weighted average coupon interest rate | 2.01% | |
Maturity date description | 2018 - 2019 | |
Capital Lease and Lease Financing Obligations | $ 8,699 | $ 38,708 |
Debt (Unsecured Credit Facility
Debt (Unsecured Credit Facility Narrative) (Details) - USD ($) | Apr. 05, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | |||
Percentage of operating partnerships gross asset value | 15.00% | ||
Debt issuance costs, net | $ 7,867,000 | $ 6,983,000 | |
Aggregate principal amount | 19,900,000 | ||
Term Loan | |||
Debt Instrument [Line Items] | |||
Outstanding debt | 700,000,000 | ||
Debt issuance costs, net | $ 5,800,000 | ||
Term Loan Maturing April 27, 2022 | |||
Debt Instrument [Line Items] | |||
Maturity date | Apr. 27, 2023 | ||
Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Maturity date | Dec. 17, 2021 | ||
Credit facility availability | $ 820,000,000 | ||
Maximum percentage of unencumbered asset pool capitalized value | 60.00% | ||
Maximum percentage of unencumbered asset pool capitalized value for two consecutive quarters | 65.00% | ||
Unencumbered asset pool debt yield limit | 14.00% | ||
Unencumbered asset pool debt yield limit for two consecutive quarters | 12.50% | ||
Leverage ratio | 1.70% | ||
Outstanding debt | $ 131,000,000 | $ 139,000,000 | |
Letter of Credit [Member] | |||
Debt Instrument [Line Items] | |||
Letter of credit outstanding | $ 2,100,000 | ||
Line of credit facility weighted average interest rate outstanding percentage | 2.89% | ||
Unsecured Credit Facility | |||
Debt Instrument [Line Items] | |||
Credit facility maximum borrowing capacity | $ 1,520,000 | ||
Line of credit facility accordion feature | $ 400,000,000 | ||
Minimum | Term Loan | LIBOR | |||
Debt Instrument [Line Items] | |||
Debt instrument spread on variable interest rate | 1.50% | ||
Minimum | Term Loan | Base Rate | |||
Debt Instrument [Line Items] | |||
Debt instrument spread on variable interest rate | 0.50% | ||
Minimum | Revolving Credit Facility | LIBOR | |||
Debt Instrument [Line Items] | |||
Debt instrument spread on variable interest rate | 1.55% | ||
Minimum | Revolving Credit Facility | Base Rate | |||
Debt Instrument [Line Items] | |||
Debt instrument spread on variable interest rate | 0.55% | ||
Maximum | Term Loan | LIBOR | |||
Debt Instrument [Line Items] | |||
Debt instrument spread on variable interest rate | 2.10% | ||
Maximum | Term Loan | Base Rate | |||
Debt Instrument [Line Items] | |||
Debt instrument spread on variable interest rate | 1.10% | ||
Maximum | Revolving Credit Facility | LIBOR | |||
Debt Instrument [Line Items] | |||
Debt instrument spread on variable interest rate | 2.15% | ||
Maximum | Revolving Credit Facility | Base Rate | |||
Debt Instrument [Line Items] | |||
Debt instrument spread on variable interest rate | 1.15% | ||
Unsecured Credit Facility | |||
Debt Instrument [Line Items] | |||
Credit facility maximum borrowing capacity | $ 1,520,000,000 | ||
Additional contingent borrowing capacity, maximum | 1,920,000,000 | ||
Minimum tangible net worth | $ 1,209,000,000 | ||
Credit facility covenant, percentage ownership requirements in addition to minimum tangible net worth | 75.00% | ||
Credit facility covenant, maximum distribution payout ratio of funds from operations | 95.00% | ||
Maximum percentage on gross asset value | 60.00% | ||
Maximum percentage to gross asset value for the next two quarters | 65.00% | ||
Outstanding debt | $ 831,000,000 | ||
Unsecured Credit Facility | Term Loan Maturing December 17,2021 | |||
Debt Instrument [Line Items] | |||
Credit facility maximum borrowing capacity | $ 350,000,000 | ||
Maturity date | Dec. 17, 2022 | ||
Unsecured Credit Facility | Term Loan Maturing April 27, 2022 | |||
Debt Instrument [Line Items] | |||
Credit facility maximum borrowing capacity | $ 350,000,000 | ||
Unsecured Credit Facility | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Credit facility maximum borrowing capacity | $ 820,000,000 | ||
Debt extension period | 1 year | ||
Interest Rate Swap | |||
Debt Instrument [Line Items] | |||
Notional amount of derivative | $ 400,000,000 | ||
Weighted average effective fixed interest rate | 3.50% | ||
Interest Rate Swap | LIBOR | |||
Debt Instrument [Line Items] | |||
Variable rate basis | LIBOR | ||
Spread | 1.50% | ||
Interest Rate Swap | Term Loan | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount | $ 400,000,000 | ||
Interest Rate Swap | Term Loan Maturing December 17,2021 | |||
Debt Instrument [Line Items] | |||
Notional amount of derivative | 200,000,000 | ||
Interest Rate Swap | Term Loan Maturing April 27, 2022 | |||
Debt Instrument [Line Items] | |||
Notional amount of derivative | $ 200,000,000 |
Debt (Senior Notes) (Details)
Debt (Senior Notes) (Details) - USD ($) $ in Thousands | Nov. 08, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Jul. 23, 2014 |
Debt Instrument [Line Items] | ||||
Aggregate principal amount | $ 19,900 | |||
Outstanding net debt issuance costs | $ 7,867 | $ 6,983 | ||
Operating Partnership And QTS Finance Corporation | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount | $ 300,000 | |||
Interest rate | 5.875% | |||
Senior notes due | 2,022 | |||
Maturity date | Aug. 1, 2022 | |||
Percentage of issued price equal to face value | 99.211% | |||
Operating Partnership Quality Tech LP And QTS Finance Corporation [Member] | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount | $ 400,000 | |||
Interest rate | 4.75% | |||
Senior notes due | 2,025 | |||
Maturity date | Nov. 15, 2025 | |||
Percentage of issued price equal to face value | 100.00% | |||
Outstanding net debt issuance costs | $ 5,800 |
Debt (Annual Remaining Principa
Debt (Annual Remaining Principal Payment) (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Debt [Abstract] | |
2,018 | $ 65 |
2,019 | 68 |
2,020 | 71 |
2,021 | 131,074 |
2,022 | 350,077 |
Thereafter | 751,511 |
Total | $ 1,232,866 |
Debt (Lease Narrative) (Details
Debt (Lease Narrative) (Details) $ in Thousands | Oct. 06, 2017USD ($) | Dec. 31, 2017USD ($)agreement | Dec. 31, 2015USD ($) | Dec. 31, 2016USD ($) |
Capital Leased Assets [Line Items] | ||||
Capital lease and lease financing obligations assumed | $ 43,832 | |||
Lease financing obligations | $ 900 | $ 20,600 | ||
Carpathia Hosting, Inc. | ||||
Capital Leased Assets [Line Items] | ||||
Capital lease, lease financing obligations and mortgage notes payable | 7,800 | |||
Capital lease and lease financing obligations assumed | $ 5,700 | |||
Number of lease agreements | agreement | 2 | |||
Outstanding financing agreement | $ 900 | |||
Carpathia Hosting, Inc. | Tenant Improvement Allowance [Member] | ||||
Capital Leased Assets [Line Items] | ||||
Lease financing obligations | $ 4,800 | |||
Lease financing expiration date | Feb. 28, 2019 | |||
Vault Campus in Dulles, Virginia | ||||
Capital Leased Assets [Line Items] | ||||
Capital lease and lease financing obligations assumed | $ 17,800 | |||
Purchase price of land | 34,100 | |||
Net purchase price | $ 16,300 | |||
Minimum | Carpathia Hosting, Inc. | ||||
Capital Leased Assets [Line Items] | ||||
Lease expiration year | 2,018 | |||
Monthly lease payment | $ 200 | |||
Maximum | Carpathia Hosting, Inc. | ||||
Capital Leased Assets [Line Items] | ||||
Lease expiration year | 2,019 | |||
Monthly lease payment | $ 500 | |||
Maximum | Carpathia Hosting, Inc. | Tenant Improvement Allowance [Member] | ||||
Capital Leased Assets [Line Items] | ||||
Lease financing monthly principal and interest payment | $ 100 |
Debt (Future Payment Obligation
Debt (Future Payment Obligations) (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Debt [Abstract] | |
2,018 | $ 7,760 |
2,019 | 939 |
Total lease obligations | $ 8,699 |
Partners' Capital, Equity and60
Partners' Capital, Equity and Incentive Compensation Plans (Narrative) (Details) $ / shares in Units, $ in Thousands | Feb. 20, 2018$ / shares | Jan. 05, 2018$ / shares | May 04, 2017item$ / shares | Dec. 31, 2017USD ($)item$ / sharesshares | Sep. 30, 2017$ / shares | Jun. 30, 2017$ / shares | Mar. 31, 2017USD ($)$ / shares | Dec. 31, 2016$ / shares | Sep. 30, 2016$ / shares | Jun. 30, 2016$ / shares | Mar. 31, 2016$ / shares | Dec. 31, 2017USD ($)Partnershipitem$ / sharesshares | Dec. 31, 2016USD ($)$ / shares | Dec. 31, 2015USD ($) | May 31, 2015shares |
Partners Capital And Distributions [Line Items] | |||||||||||||||
Equity based compensation expense unrecognized | $ | $ 18,100 | $ 18,100 | |||||||||||||
Equity based compensation expense vesting period | 1 year | ||||||||||||||
Equity based compensation awards intrinsic value | $ | $ 59,600 | $ 59,600 | |||||||||||||
Dividend paid to common stockholders | $ / shares | $ 0.39 | $ 0.39 | $ 0.39 | $ 0.36 | $ 0.36 | $ 0.36 | $ 0.36 | $ 0.32 | $ 1.53 | $ 1.40 | |||||
Dividends payable, date payable | Jul. 6, 2017 | Apr. 5, 2017 | Jan. 5, 2017 | Oct. 5, 2016 | Jul. 6, 2016 | Apr. 5, 2016 | Jan. 6, 2016 | Oct. 5, 2017 | |||||||
Shares issued, Value | $ | $ 107,495 | $ 275,862 | $ 368,664 | ||||||||||||
QTS Realty Trust, Inc. Employee Stock Purchase Plan | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Shares reserved for purchase under plan | shares | 250,000 | 250,000 | |||||||||||||
2017 Plan | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Minimum period of service | 30 days | ||||||||||||||
Minimum hours per week of service | item | 30 | ||||||||||||||
Purchase period per year | item | 4 | ||||||||||||||
Subsequent Event | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Dividend paid to common stockholders | $ / shares | $ 0.39 | ||||||||||||||
Dividends payable, date payable | Apr. 5, 2018 | Jan. 5, 2018 | |||||||||||||
Dividends payable, date declared | Feb. 20, 2018 | ||||||||||||||
Cash dividend payable per common share | $ / shares | $ 0.41 | ||||||||||||||
Class B Common Stock | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Number of votes per share | item | 50 | 50 | |||||||||||||
Class A Common Stock | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Net proceeds from issuance of shares | $ | $ 108,100 | ||||||||||||||
Class A Common Stock | At Market [Member] | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Maximum value of stock which may be issued | $ | $ 300,000 | ||||||||||||||
Shares issued | shares | 2,036,121 | ||||||||||||||
Weighted average price per share (in dollars per share) | $ / shares | $ 53.88 | ||||||||||||||
Class A Common Stock | 2017 Plan | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Discount rate of purchase price of common stock | 10.00% | ||||||||||||||
Chief Executive Officer | Class B Common Stock | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Percentage of operating partnership unit exchanged | 2.00% | ||||||||||||||
Qualitytech, LP | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Number of classes of partnership units outstanding | Partnership | 2 | ||||||||||||||
Shares issued, Value | $ | $ 107,495 | $ 275,862 | $ 368,664 | ||||||||||||
Minimum | 2017 Plan | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Minimum percentage of combined voting power | 5.00% | ||||||||||||||
Deductions per paycheck for purchase of share | $ / shares | $ 20 | ||||||||||||||
Holding period after purchase of share | 1 year | ||||||||||||||
Maximum | 2017 Plan | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Deductions per paycheck for purchase of share | $ / shares | $ 1,000 | ||||||||||||||
Restricted Class A Common Stock | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Nonvested awards outstanding | shares | 400,000 | 400,000 | |||||||||||||
Options to purchase Class A common stock | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Nonvested awards outstanding | shares | 600,000 | 600,000 | |||||||||||||
2013 Equity Incentive Plan | |||||||||||||||
Partners Capital And Distributions [Line Items] | |||||||||||||||
Authorized shares to be issued under the plan | shares | 1,750,000 | 1,750,000 | 4,750,000 |
Partners' Capital, Equity and61
Partners' Capital, Equity and Incentive Compensation Plans (Summary of Award Activity Under 2010 Equity Incentive Plan and 2013 Equity Incentive Plan and Related Information) (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
2013 Equity Incentive Plan | Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Beginning balance, Options Outstanding (in shares) | 1,058,297 | 867,882 | 584,949 |
Options, Granted (in shares) | 468,875 | 229,693 | 317,497 |
Options, Exercised (in shares) | (155,902) | (29,543) | (23,157) |
Options, Cancelled/Expired (in shares) | (2,000) | (9,735) | (11,407) |
Ending balance, Options Outstanding (in shares) | 1,369,270 | 1,058,297 | 867,882 |
Beginning balance, Weighted average exercise price options outstanding | $ 31.72 | $ 27.80 | $ 22.87 |
Weighted average exercise price options outstanding, Granted | 50.66 | 45.78 | 36.16 |
Weighted average exercise price options outstanding, Exercised | 31.89 | 25.70 | 21.30 |
Weighted average exercise price options outstanding, Cancelled/Expired | 37.69 | 32.14 | 21 |
Ending balance, Weighted average exercise price options outstanding | 38.18 | 31.72 | 27.80 |
Beginning balance, weighted average fair value, options | 6.51 | 5.56 | 4.10 |
Weighted average fair value, granted, options | 10.32 | 9.91 | 8.03 |
Weighted average fair value, vested, options | 6.60 | 4.96 | 3.63 |
Weighted average fair value, cancelled/expired, options | 8.77 | 6.95 | 3.52 |
Ending balance, weighted average fair value, options | $ 7.80 | $ 6.51 | $ 5.56 |
2013 Equity Incentive Plan | Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Beginning balance, Number of units (in shares) | 414,691 | 394,908 | 246,785 |
Number of units, Granted (in shares) | 228,576 | 237,563 | 230,271 |
Number of units, Exercised | (163,048) | (122,136) | (54,400) |
Number of units, Cancelled/Expired (in shares) | (98,355) | (95,644) | (27,748) |
Ending balance, Number of units (in shares) | 381,864 | 414,691 | 394,908 |
Beginning balance, Weighted average exercise price units | $ 40.67 | $ 33.82 | $ 29.13 |
Weighted average exercise price units, Granted | 49.86 | 45.53 | 36.71 |
Weighted average exercise price units, Exercised | 40.63 | 33.26 | 28.37 |
Weighted average exercise price units, Cancelled/Expired | 39.97 | 33.92 | 28.33 |
Ending balance, Weighted average exercise price units | $ 46.37 | $ 40.67 | $ 33.82 |
Class O Units | 2010 Equity Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Beginning balance, Number of units (in shares) | 1,134,811 | 1,292,899 | 1,518,717 |
Number of units, Exercised | (566,771) | (158,088) | (222,499) |
Number of units, Cancelled/Expired (in shares) | (3,319) | ||
Ending balance, Number of units (in shares) | 568,040 | 1,134,811 | 1,292,899 |
Beginning balance, Weighted average exercise price units | $ 24.06 | $ 23.76 | $ 23.49 |
Weighted average exercise price units, Exercised | 24.60 | 21.56 | 22.02 |
Weighted average exercise price units, Cancelled/Expired | 20 | ||
Ending balance, Weighted average exercise price units | 23.52 | 24.06 | 23.76 |
Beginning balance, Weighted average fair value | 3.62 | 3.68 | 3.75 |
Weighted average fair value, Exercised | 2.24 | 4.18 | 4.18 |
Weighted average fair value, Cancelled/Expired | 3.92 | ||
Ending balance, Weighted average fair value | $ 5 | $ 3.62 | $ 3.68 |
Class RS Units | 2010 Equity Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Beginning balance, Number of units (in shares) | 39,875 | 74,625 | |
Number of units, Released from restriction (in shares) | (39,875) | (34,750) | |
Ending balance, Number of units (in shares) | 39,875 | ||
Beginning balance, Weighted average exercise price units | $ 22.18 | $ 23.49 | |
Weighted average exercise price units, Released from restriction | $ 22.18 | 25 | |
Ending balance, Weighted average exercise price units | $ 22.18 |
Partners' Capital, Equity and62
Partners' Capital, Equity and Incentive Compensation Plans (Summary of Assumptions and Fair Values for Restricted Stock and Options to Purchase Shares of Class A Common Stock Granted) (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected dividend yield | 3.08% | 3.14% | |
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Fair value of restricted stock granted | $ 48.63 | $ 45.78 | $ 35.81 |
Fair value of options granted | $ 10.11 | $ 9.57 | $ 8 |
Expected term (years) | 5 years 6 months | 5 years 6 months | 5 years 6 months |
Expected volatility | 28.00% | 30.70% | 33.00% |
Expected dividend yield | 3.40% | ||
Expected risk-free interest rates | 2.12% | 1.42% | 1.67% |
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Fair value of restricted stock granted | $ 51.88 | $ 56.28 | |
Fair value of options granted | $ 10.36 | $ 9.97 | $ 8.77 |
Expected term (years) | 5 years 10 months 24 days | 5 years 10 months 24 days | 6 years 1 month 6 days |
Expected volatility | 31.30% | ||
Expected dividend yield | 3.57% | ||
Expected risk-free interest rates | 2.18% | 1.48% | 1.94% |
Partners' Capital, Equity and63
Partners' Capital, Equity and Incentive Compensation Plans (Summary of Information About Awards Outstanding) (Details) | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
QualityTech LP | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Awards Outstanding | 568,040 |
QTS Realty Trust, Inc Awards Outstanding | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Awards Outstanding | 1,751,134 |
QTS Realty Trust, Inc Awards Outstanding | Restricted Stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Awards Outstanding | 381,864 |
Remaining term of awards | 1 year 8 months 12 days |
QTS Realty Trust, Inc Awards Outstanding | Options to purchase Class A common stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Lower limit of exercise price | $ / shares | $ 21 |
Upper limit of exercise price | $ / shares | $ 50.66 |
Awards Outstanding | 1,369,270 |
Remaining term of awards | 9 months 18 days |
Class O Units | QualityTech LP | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Lower limit of exercise price | $ / shares | $ 20 |
Upper limit of exercise price | $ / shares | $ 25 |
Awards Outstanding | 568,040 |
Partners' Capital, Equity and64
Partners' Capital, Equity and Incentive Compensation Plans (Schedule of Quarterly Cash Dividends) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Partners' Capital, Equity and Incentive Compensation Plans [Abstract] | ||||||||||
Record Date | Jun. 16, 2017 | Mar. 16, 2017 | Dec. 16, 2016 | Sep. 20, 2016 | Jun. 17, 2016 | Mar. 18, 2016 | Dec. 17, 2015 | Sep. 22, 2017 | ||
Payment Date | Jul. 6, 2017 | Apr. 5, 2017 | Jan. 5, 2017 | Oct. 5, 2016 | Jul. 6, 2016 | Apr. 5, 2016 | Jan. 6, 2016 | Oct. 5, 2017 | ||
Per Common Share and Per Unit Rate | $ 0.39 | $ 0.39 | $ 0.39 | $ 0.36 | $ 0.36 | $ 0.36 | $ 0.36 | $ 0.32 | $ 1.53 | $ 1.40 |
Dividend/Distribution Amount | $ 22.2 | $ 21.6 | $ 21.4 | $ 19.7 | $ 19.7 | $ 19.7 | $ 17.4 | $ 15.4 | $ 84.9 | $ 72.2 |
Related Party Transactions (Sum
Related Party Transactions (Summary of Related Party Transactions) (Details) - Affiliated Entity - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||
Tax, utility, insurance and other reimbursement | $ 796 | $ 878 | $ 589 |
Rent expense | 1,014 | 1,014 | 1,014 |
Capital assets acquired | 561 | 323 | 261 |
Total | $ 2,371 | $ 2,215 | $ 1,864 |
Employee Benefit Plan (Narrativ
Employee Benefit Plan (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Employer Contribution on employee benefit plan | $ 2.6 | $ 2.5 | $ 1.3 |
First 6% of Employee Contribution | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Employer contribution rate as a percentage of employee contribution | 50.00% | ||
Percentage contribution from employees | 6.00% | ||
First 1% Percent of Contributions | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Employer contribution rate as a percentage of employee contribution | 100.00% | ||
Percentage contribution from employees | 1.00% | ||
Next 5 % Percent of Employee Contributions | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Employer contribution rate as a percentage of employee contribution | 50.00% | ||
Percentage contribution from employees | 5.00% |
Noncontrolling Interest (Narrat
Noncontrolling Interest (Narrative) (Details) shares in Millions | 12 Months Ended | |
Dec. 31, 2017shares | Dec. 31, 2016 | |
Quality Tech LP ownership percentage in operating partnership | 21.20% | |
Stock conversion ratio | 1 | |
Units redeemed for common stock | 0.6 | |
Qualitytech, LP | ||
Quality Tech LP ownership percentage in operating partnership | 11.40% | 12.40% |
Earnings per share of QTS Rea68
Earnings per share of QTS Realty Trust, Inc.(Narrative) (Details) - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Earnings per Share [Abstract] | ||
Antidilutive shares excluded from the computation of diluted net earning per share | 0 | 0 |
Earnings per share of QTS Rea69
Earnings per share of QTS Realty Trust, Inc. (Computation of Basic and Diluted Net Income per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Earnings per Share [Abstract] | |||||||||||
Net income available to common stockholders - basic | $ (14,142) | $ 6,507 | $ 4,040 | $ 4,877 | $ 4,806 | $ 5,730 | $ 5,100 | $ 5,889 | $ 1,282 | $ 21,525 | $ 20,326 |
Effect of net income attributable to noncontrolling interests and income allocated to participating securities | (593) | 3,160 | 3,803 | ||||||||
Net income available to common stockholders | $ 689 | $ 24,685 | $ 24,129 | ||||||||
Weighted average shares outstanding - basic | 48,380,964 | 46,205,937 | 37,568,109 | ||||||||
Effect of Class A and Class RS partnership units | 6,696,000 | 6,783,000 | 7,029,000 | ||||||||
Effect of Class O units and options to purchase Class A common stock and restricted Class A common stock on an "as if" converted basis | 779,000 | 973,000 | 756,000 | ||||||||
Weighted average shares outstanding-diluted | 55,855,683 | 53,962,234 | 45,353,170 | ||||||||
Basic net income per share | $ (0.29) | $ 0.13 | $ 0.08 | $ 0.10 | $ 0.10 | $ 0.12 | $ 0.11 | $ 0.14 | $ 0.01 | $ 0.47 | $ 0.54 |
Diluted net income per share | $ (0.29) | $ 0.13 | $ 0.08 | $ 0.10 | $ 0.10 | $ 0.12 | $ 0.10 | $ 0.14 | $ 0.01 | $ 0.46 | $ 0.53 |
Operating Leases, as Lessee (Na
Operating Leases, as Lessee (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Operating Leased Assets [Line Items] | |||
Rent expense under operating leases | $ 17.9 | $ 20.1 | $ 14.6 |
Capitalized rent | $ 0.1 | $ 0 | |
Santa Clara | |||
Operating Leased Assets [Line Items] | |||
Sublease expiration period | 2052-10 |
Operating Leases, as Lessee (Fu
Operating Leases, as Lessee (Future Non-cancellable Minimum Rental Payments Required Under Operating Leases and/or Licenses) (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Leases [Abstract] | |
2,018 | $ 15,031 |
2,019 | 10,259 |
2,020 | 9,894 |
2,021 | 9,931 |
2,022 | 9,675 |
Thereafter | 65,126 |
Total | $ 119,916 |
Customer Leases, as Lessor (Fut
Customer Leases, as Lessor (Future Minimum Lease Payments to be Received Under Non-Cancelable Operating Customer Leases) (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Leases [Abstract] | |
2,018 | $ 334,594 |
2,019 | 239,485 |
2,020 | 172,280 |
2,021 | 130,969 |
2,022 | 84,660 |
Thereafter | 82,873 |
Total | $ 1,044,861 |
Fair Value of Financial Instr73
Fair Value of Financial Instruments (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value Of Financial Instruments [Line Items] | |||
Other comprehensive gain | $ 1,449 | ||
Operating Partnership Quality Tech LP And QTS Finance Corporation [Member] | Fair Value Measurements, Level 2 | |||
Fair Value Of Financial Instruments [Line Items] | |||
Fair value of loan based on current market rates | 404,000 | ||
Interest Rate Swap | |||
Fair Value Of Financial Instruments [Line Items] | |||
Other comprehensive gain | $ 0 | $ 0 | |
Other Assets. | Interest Rate Swap | |||
Fair Value Of Financial Instruments [Line Items] | |||
Derivative Asset | 1,400 | ||
Accumulated Other Comprehensive Income (Loss) | Interest Rate Swap | |||
Fair Value Of Financial Instruments [Line Items] | |||
Other comprehensive gain | $ 1,400 |
Quarterly Financial Informati74
Quarterly Financial Information (Summary of Selected Quarterly Information) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Effect of Fourth Quarter Events [Line Items] | |||||||||||
Revenues | $ 118,911 | $ 113,767 | $ 107,868 | $ 105,964 | $ 105,443 | $ 103,465 | $ 98,687 | $ 94,768 | $ 446,510 | $ 402,363 | $ 311,083 |
Operating income | 7,553 | 12,833 | 10,826 | 10,915 | 11,092 | 8,505 | 8,225 | 10,235 | 42,127 | 38,057 | 35,983 |
Net income (loss) | (16,113) | 7,394 | 4,608 | 5,568 | 5,481 | 6,538 | 5,807 | 6,859 | 1,457 | 24,685 | 24,129 |
Net income (loss) attributable to common shares | $ (14,142) | $ 6,507 | $ 4,040 | $ 4,877 | $ 4,806 | $ 5,730 | $ 5,100 | $ 5,889 | $ 1,282 | $ 21,525 | $ 20,326 |
Basic (in dollars per share) | $ (0.29) | $ 0.13 | $ 0.08 | $ 0.10 | $ 0.10 | $ 0.12 | $ 0.11 | $ 0.14 | $ 0.01 | $ 0.47 | $ 0.54 |
Diluted (in dollars per share) | $ (0.29) | $ 0.13 | $ 0.08 | $ 0.10 | $ 0.10 | $ 0.12 | $ 0.10 | $ 0.14 | $ 0.01 | $ 0.46 | $ 0.53 |
Qualitytech, LP | |||||||||||
Effect of Fourth Quarter Events [Line Items] | |||||||||||
Revenues | $ 118,911 | $ 113,767 | $ 107,868 | $ 105,964 | $ 105,443 | $ 103,465 | $ 98,687 | $ 94,768 | $ 446,510 | $ 402,363 | $ 311,083 |
Operating income | 7,553 | 12,833 | 10,826 | 10,915 | 11,092 | 8,505 | 8,225 | 10,235 | 42,127 | 38,057 | 35,983 |
Net income (loss) | $ (16,113) | $ 7,394 | $ 4,608 | $ 5,568 | $ 5,481 | $ 6,538 | $ 5,807 | $ 6,859 | $ 1,457 | $ 24,685 | $ 24,129 |
Subsequent Events (Narrative) (
Subsequent Events (Narrative) (Details) - $ / shares | Feb. 20, 2018 | Jan. 05, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 |
Subsequent Event [Line Items] | ||||||||||||
Dividend paid to common stockholders | $ 0.39 | $ 0.39 | $ 0.39 | $ 0.36 | $ 0.36 | $ 0.36 | $ 0.36 | $ 0.32 | $ 1.53 | $ 1.40 | ||
Dividends payable, date of record | Jun. 16, 2017 | Mar. 16, 2017 | Dec. 16, 2016 | Sep. 20, 2016 | Jun. 17, 2016 | Mar. 18, 2016 | Dec. 17, 2015 | Sep. 22, 2017 | ||||
Dividends payable, date payable | Jul. 6, 2017 | Apr. 5, 2017 | Jan. 5, 2017 | Oct. 5, 2016 | Jul. 6, 2016 | Apr. 5, 2016 | Jan. 6, 2016 | Oct. 5, 2017 | ||||
Subsequent Event | ||||||||||||
Subsequent Event [Line Items] | ||||||||||||
Dividend paid to common stockholders | $ 0.39 | |||||||||||
Cash dividend payable per common share | $ 0.41 | |||||||||||
Dividends payable, date declared | Feb. 20, 2018 | |||||||||||
Dividends payable, date of record | Mar. 22, 2018 | Dec. 5, 2017 | ||||||||||
Dividends payable, date payable | Apr. 5, 2018 | Jan. 5, 2018 |
Schedule II - Valuation and Q76
Schedule II - Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Allowance for Doubtful Accounts | |||
Balance at beginning of period | $ 4,217 | $ 5,063 | $ 3,748 |
Charge to expenses | 7,375 | 1,752 | 1,323 |
Additions/(Deductions) | (139) | (2,598) | (8) |
Balance at end of period | 11,453 | 4,217 | 5,063 |
Valuation Allowance for Deferred Tax Assets | |||
Balance at beginning of period | 393 | 393 | 3,788 |
Charge to expenses | 320 | ||
Additions/(Deductions) | (3,395) | ||
Balance at end of period | $ 713 | $ 393 | $ 393 |
Schedule III - Real Estate In77
Schedule III - Real Estate Investments - Amount that Tax Basis of Net Real Estate Assets Less Than the Reported Amounts (Details) $ in Millions | Dec. 31, 2017USD ($) |
Schedule III - Real Estate Investments [Abstract] | |
Tax Basis of Investments, Cost for Income Tax Purposes | $ 2,440 |
Schedule III - Real Estate In78
Schedule III - Real Estate Investments (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | $ 51,156 | |||
Initial costs of buildings and improvements | 364,686 | |||
Initial costs of construction in progress | 183,982 | |||
Costs capitalized subsequent to acquisition, Land | 37,060 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 1,336,601 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 383,837 | |||
Gross carrying amount, Land | 88,216 | |||
Gross carrying amount, Buildings and improvements | 1,701,287 | |||
Gross carrying amount, Construction in progress | 567,819 | |||
Accumulated depreciation and amortization | (394,823) | $ (317,834) | $ (239,936) | $ (180,167) |
Owned Properties | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | 51,156 | |||
Initial costs of buildings and improvements | 303,614 | |||
Initial costs of construction in progress | 183,982 | |||
Costs capitalized subsequent to acquisition, Land | 37,060 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 1,337,486 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 378,265 | |||
Gross carrying amount, Land | 88,216 | |||
Gross carrying amount, Buildings and improvements | 1,641,100 | |||
Gross carrying amount, Construction in progress | 562,247 | |||
Accumulated depreciation and amortization | (358,327) | |||
Owned Properties | Atlanta, Georgia (Atlanta-Metro) | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | 12,647 | |||
Initial costs of buildings and improvements | 35,473 | |||
Costs capitalized subsequent to acquisition, Land | 7,769 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 417,363 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 28,614 | |||
Gross carrying amount, Land | 20,416 | |||
Gross carrying amount, Buildings and improvements | 452,836 | |||
Gross carrying amount, Construction in progress | 28,614 | |||
Accumulated depreciation and amortization | $ (139,859) | |||
Date of acquisition | Oct. 3, 2006 | |||
Owned Properties | Irving Texas | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of buildings and improvements | $ 5,808 | |||
Costs capitalized subsequent to acquisition, Land | 8,606 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 271,086 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 86,320 | |||
Gross carrying amount, Land | 8,606 | |||
Gross carrying amount, Buildings and improvements | 276,894 | |||
Gross carrying amount, Construction in progress | 86,320 | |||
Accumulated depreciation and amortization | $ (23,997) | |||
Date of acquisition | Feb. 8, 2013 | |||
Owned Properties | Richmond, Virginia | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | $ 2,000 | |||
Initial costs of buildings and improvements | 11,200 | |||
Costs capitalized subsequent to acquisition, Land | 180 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 243,403 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 61,888 | |||
Gross carrying amount, Land | 2,180 | |||
Gross carrying amount, Buildings and improvements | 254,603 | |||
Gross carrying amount, Construction in progress | 61,888 | |||
Accumulated depreciation and amortization | $ (49,561) | |||
Date of acquisition | Mar. 20, 2010 | |||
Owned Properties | Chicago, Illinois | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of construction in progress | $ 17,764 | |||
Costs capitalized subsequent to acquisition, Land | 9,400 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 81,463 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 117,715 | |||
Gross carrying amount, Land | 9,400 | |||
Gross carrying amount, Buildings and improvements | 81,463 | |||
Gross carrying amount, Construction in progress | 135,479 | |||
Accumulated depreciation and amortization | $ (4,619) | |||
Date of acquisition | Jul. 8, 2014 | |||
Owned Properties | Suwanee, Georgia | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | $ 1,395 | |||
Initial costs of buildings and improvements | 29,802 | |||
Costs capitalized subsequent to acquisition, Land | 2,126 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 136,113 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 3,620 | |||
Gross carrying amount, Land | 3,521 | |||
Gross carrying amount, Buildings and improvements | 165,915 | |||
Gross carrying amount, Construction in progress | 3,620 | |||
Accumulated depreciation and amortization | $ (61,029) | |||
Date of acquisition | Sep. 1, 2005 | |||
Owned Properties | Piscataway New Jersey | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | $ 7,466 | |||
Initial costs of buildings and improvements | 80,366 | |||
Initial costs of construction in progress | 13,900 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 2,885 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 23,907 | |||
Gross carrying amount, Land | 7,466 | |||
Gross carrying amount, Buildings and improvements | 83,251 | |||
Gross carrying amount, Construction in progress | 37,807 | |||
Accumulated depreciation and amortization | $ (3,610) | |||
Date of acquisition | Jun. 6, 2016 | |||
Owned Properties | Santa Clara, California | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of buildings and improvements | $ 15,838 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 84,190 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 6,989 | |||
Gross carrying amount, Buildings and improvements | 100,028 | |||
Gross carrying amount, Construction in progress | 6,989 | |||
Accumulated depreciation and amortization | $ (36,662) | |||
Date of acquisition | Nov. 1, 2007 | |||
Owned Properties | Sacramento, California | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | $ 1,481 | |||
Initial costs of buildings and improvements | 52,753 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 11,498 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 58 | |||
Gross carrying amount, Land | 1,481 | |||
Gross carrying amount, Buildings and improvements | 64,251 | |||
Gross carrying amount, Construction in progress | 58 | |||
Accumulated depreciation and amortization | $ (9,224) | |||
Date of acquisition | Dec. 21, 2012 | |||
Owned Properties | Fort Worth, Texas | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | $ 136 | |||
Initial costs of buildings and improvements | 610 | |||
Initial costs of construction in progress | 48,984 | |||
Costs capitalized subsequent to acquisition, Land | 8,943 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 17,284 | |||
Costs capitalized subsequent to acquisition, Construction in progress | (15,210) | |||
Gross carrying amount, Land | 9,079 | |||
Gross carrying amount, Buildings and improvements | 17,894 | |||
Gross carrying amount, Construction in progress | 33,774 | |||
Accumulated depreciation and amortization | $ (434) | |||
Date of acquisition | Dec. 16, 2016 | |||
Owned Properties | Princeton, New Jersey | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | $ 20,700 | |||
Initial costs of buildings and improvements | 32,126 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 822 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 451 | |||
Gross carrying amount, Land | 20,700 | |||
Gross carrying amount, Buildings and improvements | 32,948 | |||
Gross carrying amount, Construction in progress | 451 | |||
Accumulated depreciation and amortization | $ (3,059) | |||
Date of acquisition | Jun. 30, 2014 | |||
Owned Properties | Dulles, Virginia | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | $ 3,154 | |||
Initial costs of buildings and improvements | 29,583 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 46,656 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 3,565 | |||
Gross carrying amount, Land | 3,154 | |||
Gross carrying amount, Buildings and improvements | 76,239 | |||
Gross carrying amount, Construction in progress | 3,565 | |||
Accumulated depreciation and amortization | $ (15,861) | |||
Date of acquisition | Oct. 6, 2017 | |||
Owned Properties | Ashburn, Virginia | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of construction in progress | $ 53,009 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 53,943 | |||
Gross carrying amount, Construction in progress | $ 106,952 | |||
Date of acquisition | Aug. 9, 2017 | |||
Owned Properties | Phoenix, Arizona | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of construction in progress | $ 24,668 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 2,734 | |||
Gross carrying amount, Construction in progress | $ 27,402 | |||
Date of acquisition | Aug. 11, 2017 | |||
Owned Properties | Hillsboro, Oregon | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of construction in progress | $ 25,657 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 3,621 | |||
Gross carrying amount, Construction in progress | $ 29,278 | |||
Date of acquisition | Oct. 3, 2017 | |||
Owned Properties | Miami, Florida | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | $ 1,777 | |||
Initial costs of buildings and improvements | 6,955 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 23,989 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 48 | |||
Gross carrying amount, Land | 1,777 | |||
Gross carrying amount, Buildings and improvements | 30,944 | |||
Gross carrying amount, Construction in progress | 48 | |||
Accumulated depreciation and amortization | $ (10,077) | |||
Date of acquisition | Mar. 6, 2008 | |||
Owned Properties | Lenexa, Kansas | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of land | $ 400 | |||
Initial costs of buildings and improvements | 3,100 | |||
Costs capitalized subsequent to acquisition, Land | 36 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 734 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 2 | |||
Gross carrying amount, Land | 436 | |||
Gross carrying amount, Buildings and improvements | 3,834 | |||
Gross carrying amount, Construction in progress | 2 | |||
Accumulated depreciation and amortization | $ (335) | |||
Date of acquisition | Jun. 3, 2011 | |||
Leased Properties | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of buildings and improvements | $ 61,072 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | (885) | |||
Costs capitalized subsequent to acquisition, Construction in progress | 5,572 | |||
Gross carrying amount, Buildings and improvements | 60,187 | |||
Gross carrying amount, Construction in progress | 5,572 | |||
Accumulated depreciation and amortization | (36,496) | |||
Leased Properties | Leased Facilities acquired in 2015 | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of buildings and improvements | 59,087 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | (23,278) | |||
Costs capitalized subsequent to acquisition, Construction in progress | 146 | |||
Gross carrying amount, Buildings and improvements | 35,809 | |||
Gross carrying amount, Construction in progress | 146 | |||
Accumulated depreciation and amortization | $ (24,512) | |||
Date of acquisition | Jun. 16, 2015 | |||
Leased Properties | Jersey City, New Jersey | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Initial costs of buildings and improvements | $ 1,985 | |||
Costs capitalized subsequent to acquisition, Buildings and improvements | 21,663 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 5,388 | |||
Gross carrying amount, Buildings and improvements | 23,648 | |||
Gross carrying amount, Construction in progress | 5,388 | |||
Accumulated depreciation and amortization | $ (11,411) | |||
Date of acquisition | Nov. 1, 2006 | |||
Leased Properties | Overland Park, Kansas | ||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||
Costs capitalized subsequent to acquisition, Buildings and improvements | $ 730 | |||
Costs capitalized subsequent to acquisition, Construction in progress | 38 | |||
Gross carrying amount, Buildings and improvements | 730 | |||
Gross carrying amount, Construction in progress | 38 | |||
Accumulated depreciation and amortization | $ (573) |
Schedule III - Real Estate In79
Schedule III - Real Estate Investments (Summary of Historical Cost and Accumulated Depreciation) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property | |||
Balance, beginning of period | $ 1,964,857 | $ 1,583,153 | $ 1,177,582 |
Disposals | (18,198) | (8,946) | (5,617) |
Additions (acquisitions and improvements) | 410,663 | 390,650 | 411,188 |
Balance, end of period | 2,357,322 | 1,964,857 | 1,583,153 |
Accumulated depreciation | |||
Balance, beginning of period | (317,834) | (239,936) | (180,167) |
Disposals | 13,970 | 6,761 | 1,377 |
Additions (depreciation and amortization expense) | (90,959) | (84,659) | (61,146) |
Balance, end of period | $ (394,823) | $ (317,834) | $ (239,936) |