Digital Realty Borrows €1 Billion at 5.125% and CHF 510 Million at Under 2.5%

Digital Realty Trust, the Austin data center company, filed a Form 8-K on Friday, October 9, 2026 reporting that a finance subsidiary, Digital Euro Finco, LLC, issued and sold €1,000,000,000 of 5.125 percent Guaranteed Notes due 2036 that day. The notes are senior and unsecured, guaranteed by Digital Realty Trust, Inc. and its operating partnership, and were sold outside the United States under Regulation S. The initial purchasers paid 99.289 percent of principal, and the filing puts net proceeds at approximately €985.8 million. Interest is paid once a year on October 9, starting in 2027, which computes to €51.25 million a year. The notes mature October 9, 2036. The company says it intends to allocate an amount equal to the net proceeds to what it calls Eligible Green Projects, a list that runs from renewable energy and energy efficiency to green buildings. Until it does, the filing says, the money may repay revolving credit borrowings, buy properties or businesses, fund development, or repay other debt.

This was the second closing of the week. A Form 8-K filed October 6 reports that another subsidiary, Digital Constellation B.V., issued CHF 510 million of Swiss franc notes that day in three series: CHF 225 million at 1.6803 percent due October 8, 2029, CHF 185 million at 2.0600 percent due October 6, 2032, and CHF 100 million at 2.4150 percent due October 6, 2036. They sold at 100 percent of principal, and net proceeds were CHF 508.39 million. Those coupons compute to about CHF 10.0 million of interest a year and a blended rate of about 1.96 percent. The franc notes carry one more guarantor than the euro notes: Digital Intrepid Holding B.V., the subsidiary through which the company holds its Interxion business in Europe. Both filings say the terms limit additional debt and require the company to maintain a pool of unencumbered assets.

Set the new coupons beside the old ones. Digital Realty’s Form 10-Q for the quarter ended June 30, 2026 reports $18.8 billion of total debt at a weighted average rate of 2.99 percent, and $16.0 billion of unsecured senior notes at 2.60 percent. The new euro notes at 5.125 percent compute to about twice that note average. The 10-Q lists eleven euro note issues outstanding at June 30, with coupons from 0.625 percent to 4.250 percent. The new issue is above all of them. The Swiss franc side shows the same thing at a lower level. The 10-Q lists CHF 275 million of 0.200 percent notes due December 15, 2026 and CHF 150 million of 1.700 percent notes due March 30, 2027. The new three-year franc notes pay 1.6803 percent, which computes to more than eight times the coupon on the notes maturing in December. The filings do not say the new notes will retire the old ones. That pairing is PSV’s, drawn from the maturity table.

The maturity table is the reason to care. By the 10-Q’s schedule as of June 30, $825 million of debt was due in the second half of 2026, $2.16 billion in 2027 and $2.53 billion in 2028. That computes to about $5.5 billion, or 29 percent of the total, in two and a half years. Three note issues in that window carry coupons under 2 percent, and their June 30 balances compute to about $1.1 billion. Meanwhile the company is building: 1,402 megawatts under way at June 30, which it says is about 82 percent more than at year end, with 54 percent pre-leased, roughly $4.1 billion of construction contracts open, and $1.48 billion of development spending in the first half. None of this signals strain. The covenant table in the 10-Q shows unencumbered assets at more than 300 percent of unsecured debt against a 150 percent floor, and interest coverage of 5.2 times against a 1.5 times floor. The point is narrower. An average rate is a record of past borrowing. Friday’s 8-K is the price of the next euro.

The work is one table per owner, built from records the owner already has or, for a public company, from its filings. The inputs are the debt schedule with each loan or note, its currency, coupon and maturity; the covenant definitions; and a current price for new debt of the same term, taken from a filed transaction or a lender quote with a date on it. The output lists each maturity in order with three figures beside it: the interest paid today, the interest at the replacement price, and the difference. A last column carries the covenant ratio after the change. For Digital Realty the public version of that table can be built from the June 30 10-Q and this week’s two 8-Ks. For a private owner it is the loan file and the last three term sheets.

The reviewer is the head of capital markets or the chief financial officer, with the asset manager confirming which properties sit in the unencumbered pool. The approval gate: no acquisition model, hold-sell analysis or development budget uses a portfolio average rate for debt that matures inside the hold period. Each one uses the replacement figure from the table, with its source and date shown. An assistant helps with the reading. The debt note in a large REIT’s 10-Q runs several pages, the same notes appear in three tables under slightly different names, and foreign currency balances move every quarter. Extracting the rows and lining them up is work to hand off. Choosing the replacement price is not. PSV ran no model on these filings, tested no product, and promises no rate, saving or financing outcome.