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Digital Realty Trust details US, UK asset deals in Q4'17, Q1'18

During the 2017 fourth quarter, Digital Realty Trust Inc. carried out two asset purchases in Chicago and one in London and completed the sale of an office property in St. Louis, Mo., for $37 million.

The bigger of the two purchases in Chicago, worth $315 million, brought forth a 250,000-square-foot data center, that is about three-fourths completed and fully leased. It is expected to generate cash net operating income of approximately $22 million in 2018, reflecting a 7% going-in cap rate. The remaining 65,000 square feet of shell space at the 19-acre site is available for build-out.

A 1.4-acre land parcel adjacent to 350 E. Cermak in Chicago was also snapped up for $25 million. The site is expected to deliver a 12-story, 720,000-square-foot data center, with development subject to market demand.

Over at London, Digital Realty paid approximately £22 million for a 132,000-square-foot, multistory parking garage, which is expected to bring in £800,000 of net operating income, marking a 4% cap rate on in-place parking income.

Additionally, the real estate investment trust, which focuses on making investments in data centers, registered an about $25 million gain in the 2018 first quarter from the $73 million sale of the 86%-leased 34551 Ardenwood Blvd. in Fremont, Calif. Net proceeds of $72 million were recorded from the 323,000-square-foot technology manufacturing property's divestment.

In the three-month term ended Dec. 31, 2017, Digital Realty sold the 100%-leased, 156,000-square-foot 1 Solutions Parkway for $37 million. Disposal of the office building resulted in $35 million of net proceeds, with an approximately $15 million gain on the sale.