QTS Realty Trust, Inc.

Transcription

1 QTS Realty Trust, Inc. Investor Presentation Third Quarter 2018

2 QTS Realty Trust, Inc. 1 Forward Looking Statements Some of the statements contained in this presentation constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In particular, statements pertaining to our capital resources, portfolio performance results of operations, anticipated growth in our funds from operations and anticipated market conditions contain forward-looking statements. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as may, will, should, expects, intends, plans, anticipates, believes, estimates, predicts, or potential or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. The forward-looking statements contained in this presentation reflect our current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances that may cause our actual results to differ significantly from those expressed in any forward-looking statement. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: adverse economic or real estate developments in our markets or the technology industry; obsolescence or reduction in marketability of our infrastructure due to changing industry demands; global, national and local economic conditions; risks related to our international operations; our ability to successfully execute our strategic growth plan and realize its expected benefits; difficulties in identifying properties to acquire and completing acquisitions; our failure to successfully develop, redevelop and operate acquired properties or lines of business; significant increases in construction and development costs; the increasingly competitive environment in which we operate; defaults on, or termination or non-renewal of, leases by customers; decreased rental rates or increased vacancy rates; increased interest rates and operating costs, including increased energy costs; financing risks, including our failure to obtain necessary outside financing; dependence on third parties to provide Internet, telecommunications and network connectivity to our data centers; our failure to qualify and maintain our qualification as a REIT; environmental uncertainties and risks related to natural disasters; financial market fluctuations; and changes in real estate and zoning laws, revaluations for tax purposes and increases in real property tax rates. While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. Any forward-looking statement speaks only as of the date on which it was made. We disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. For a further discussion of these and other factors that could cause our future results to differ materially from any forward-looking statements, see the section entitled Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2017 ( 10-K ) and in the other periodic reports we file with the Securities and Exchange Commission. This presentation includes measures not derived in accordance with generally accepted accounting principles ( GAAP ), such as FFO, operating FFO, adjusted Operating FFO, EBITDA, adjusted EBITDA, NOI, ROIC and MRR. These measures should not be considered in isolation or as a substitute for any measure derived in accordance with GAAP, and may also be inconsistent with similar measures presented by other companies. Reconciliation of these measures to the most closely comparable GAAP measures are presented in the attached pages. We refer you to the appendix of this presentation for reconciliations of these measures and to the section entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations--Non-GAAP Financial Measures" in our 10-K for further information regarding these measures..

3 QTS Realty Trust, Inc. 2 Differentiated Capability to Drive Success in Both Hyperscale and Hybrid Colocation Hyperscale Customers Need Hybrid Colocation Customers Need Scale Speed Economics Secure & Compliant Integrated Hybrid Solutions Seamless Connectivity Premium Customer Service Secure & Compliant QTS Solutions World-Class Infrastructure & Mega Data Centers Significant Growth Capacity 1.3M sq. ft. of powered shell capacity in top U.S. markets with ability to scale quickly and efficiently Operating and Build Cost Advantage Low basis focus & mega scale approach provide permanent cost advantage New Market Expansion in NoVA, Phoenix and Hillsboro Provides future growth capacity in markets where hyperscale customers want to be Premium Customer Experience and Service Delivery Software-defined platform and service delivery track record provide further differentiation for hyperscale customers QTS Solutions Hybrid Colocation Platform Software-Defined Data Center Platform Provides infrastructure visibility and dynamic control to customers Enhanced Hybrid Solutions through Integrated Partners Strategic partnerships with technology and IT services providers expand hybrid colocation opportunity Seamless Connectivity SDN-enabled universal connectivity to carriers, service providers and CSP s High-End Security and Compliance Dedicated team to help enterprises mitigate cybersecurity risks Premium Customer Experience Portfolio of managed services and industry-leading net promoter scores

4 QTS Realty Trust, Inc. 3 Uniquely Positioned Where CIOs Are Investing The Most Top Technology Areas Attracting New Spending What are the technology areas where your organization will be spending the highest amount of new or additional funding in 2018?* QTS is able to solve Enterprises top IT needs 1. Hybrid Cloud Solutions SOFTWARE-DEFINED DATA CENTER PLATFORM delivers flexibility and product capability to provide hybrid data center solutions 2. Data Center Infrastructure WORLD-CLASS MEGA DATA CENTERS provide visibility into significant future growth capacity 3. Cybersecurity INDUSTRY-LEADING SECURITY & COMPLIANCE capabilities enable QTS to be customers trusted partner to help manage risk *Reflects results from Gartner survey of 2,496 Enterprise CIOs published March 9, 2018 entitled, 2018 CIO Agenda: A U.S. Perspective.

5 QTS Realty Trust, Inc. 4 Broad Footprint Focused On Top Data Center Markets 2.7 million sq. ft. of raised floor capacity 1 and 670+ MW of available utility power 2 26 DATA CENTERS 14 MARKETS 95% WHOLLY-OWNED 3 1. Represents basis-of-design floor space as of June 30, The Company defines basis-of-design floor space as the total data center raised floor potential of its existing data center facilities. 2. Represents installed utility power and transformation capacity that is available for use by the facility as of June 30, Based on data center raised floor. Does not include data centers subject to capital lease obligations. Includes Santa Clara, CA which is subject to a long-term ground lease.

6 (Raised Floor NRSF in 000s) QTS Realty Trust, Inc. 5 Powered Shell Capacity Represents 5+ Years of Growth 1.3M Sq. Ft. Additional Capacity in Existing Powered Shell 2,744 2,744 1,805 53% currently built out 1,294 Capacity to nearly double raised floor in existing powered shell and current developments 41% built out 1,450 Full Capacity Able to approximately double raised floor capacity again through development on 544 acres of adjacent, owned land and real estate 741 De-risks future growth path at known build costs and higher incremental returns As of IPO As of Q2 18 Full Buildout 1 1. Full Buildout reflects our Basis of Design NRSF at full buildout, including 66,324 basis-of-design square feet currently in development in Manassas, VA; does not include additional development which could take place on adjacent, owned land.

7 QTS Realty Trust, Inc. 6 Best-in-Class Mega Data Centers Atlanta-Suwanee, GA 36MW Atlanta-Metro, GA 120MW 1 Richmond, VA 110MW 100% Built Out 205,608 Sq. Ft. 205,608 Sq. Ft. ROIC: 28.1% 2 Occupied: 91.6% 88% Built Out 463,986 Sq. Ft. 527,186 Sq. Ft. ROIC: 17.8% 2 Occupied: 97.7% 30% Built Out 167,309 Sq. Ft. 557,309 Sq. Ft. ROIC: 11.0% 2 Occupied: 73.4% Irving, TX 140MW Piscataway, NJ 111MW Chicago, IL 55MW 3 61% Built Out 168,160 Sq. Ft. 275,701 Sq. Ft. ROIC: 13.4% 2 Occupied: 97.6% 51% Built Out 88,820 Sq. Ft. 176,000 Sq. Ft. ROIC: 10.7% 2 Occupied: 87.5% 15% Built Out 33,000 Sq. Ft. 215,855 Sq. Ft. ROIC: 8.6% 2 Occupied: 78.9% Note: Square footage reflects current Raised Floor Operating Net Rentable Square Feet ( NRSF ) as of June 30, 2018 (red shaded bars) and Basis of Design Raised Floor NRSF at full buildout. MW denotes available utility power as of June 30, Occupied percentage as of June 30, Atlanta -Metro currently has 72 MW of available utility power based on current agreements with its utility provider but has transformer capacity for 120 MW. 2. ROIC calculated by dividing annualized core NOI for the quarter ended June 30, 2018 by the average total cost, less construction in progress for the quarters ended June 30, 2018 and March 31, MW available utility power as of June 31, 2018, with an additional 47 MW available upon QTS request.

8 QTS Realty Trust, Inc. 7 Mega Scale & Hybrid Colocation Platform Enable Premium ROIC Potential % OF CAPACITY BUILT OUT ROIC 8.6% Mega Data Center Lifecycle ROIC 10.7% ROIC 13.4% ROIC 11.0% ROIC 17.8% ROIC 28.1% 15% Built Out 51% Built Out 61% Built Out 30% Built Out 88% Built Out 100% Built Out Combination of operating leverage + higher Hybrid Colocation penetration over the life of a mega scale data center drives higher ROIC Chicago, IL 2 Years Piscataway, NJ 2 Years Irving, TX 4 Years Richmond, VA 7 Years Atlanta, GA 11 Years Suwanee, GA 12 Years Years in Operation Note: ROIC calculated by dividing annualized core NOI for the quarter ended June 30, 2018 by the average total cost, less construction in progress for the quarters ended June 30, 2018 and March 31, 2018.

9 QTS Realty Trust, Inc. 8 Strong Competitive Positioning in Atlanta Atlanta market strengthening Atlanta continues to build momentum as Tier 1 market based on low power cost, low natural disaster risk, fiber availability and concentration of corporate HQ s New legislation outlining tax incentives for data centers Georgia House Bill Culmination of four years of work by QTS, in coordination with Technology Association of Georgia - Further establishes Atlanta as destination for data center deployment - Will provide incremental economic incentives to QTS as well as existing and new customers 25% of QTS new logos generated in Atlanta footprint year-to-date through Q2 18 Incumbent competitive advantage with significant growth opportunity 670k sq. ft. of raised floor capacity built enables significant operating leverage Atlanta generating 20%+ average ROIC 540+ embedded customer base 120MW owned substation enables QTS to offer the lowest cost of power in Atlanta 2,000+ cross connects Capacity to expand to 733k sq. ft. of raised floor under existing powered shell 32 acres of adjacent owned land enables future growth capacity Atlanta-Metro site is one of the most strategic, interconnected in Southeast

10 QTS Realty Trust, Inc. 9 The QTS Hyperscale Advantage * JLL Global Data Center Outlook 2018

11 QTS Realty Trust, Inc. 10 Software-Defined Platform Accelerates Differentiation in Hybrid Colocation Cloud-Like Colocation Integrated Hybrid Cloud Solutions Software-Defined Control Software-Defined Connectivity Remote Hands & Data Center Logistics Security & Compliance Industry Leading Customer Service

12 QTS Realty Trust, Inc. 11 QTS Software Defined Data Center Platform Service Delivery Platform provides QTS the first true Software Defined Data Center QTS building with our partners, taking neutral approach Over 15,000 SDP Users 15+ Integrated Partners 90M Data Points Collected Per Day

13 QTS Realty Trust, Inc. 12 QTS Service Delivery Platform - Third Party Feedback On how they leverage SDP Today: SDP allowed us to review over and under-subscribed cabinets in real-time, enabling us to shift infrastructure or increase our density. VP of IT (Multi-National Bank) Customers and Partners On using SDP for their Customers: The Power Analytics App is a game-changer. Most of your competitors take 3 weeks to provide this data to our Customers. On how SDP drove the selection of QTS: There was not a close 2 nd in our evaluation. The innovation of SDP combined with Solution Portability and NPS made this an easy decision. IT Director (Clean Energy Automotive Manufacturer) Product Manager (Communications Service Provider Partner) Industry Analysts On QTS Power & Sensor Real-Time Analytics You are showing things that have been on my clients wish list for quite some time.mostly what they get from your competitors is a really limited subset of what you ve just shown Research Vice President, Infrastructure Strategies Group Industry Leading Research & Advisory Firm On QTS vision for Hybrid Colocation On how QTS SDP Platform Interacts with Customers You have cemented yourselves as the provider that is pushing the boundaries in development and service delivery. It s clear you are more than just a colo provider Research Vice President, Technology Service Provider Group Industry Leading Research & Advisory Firm The API and programmatic approach, being able to bridge into the physical world is very attractive. I see differentiation here Research Director, Cloud Service Provider Group Industry Leading Research & Advisory Firm

14 QTS Realty Trust, Inc. 13 Q Operating Performance Review Signed new/modified leases totaling $13.1M of core incremental annualized rent In line with prior four quarter average leasing Strongest first half of year leasing volume since IPO in 2013 Booked-not-billed backlog steady at $51M of core annualized rent as of Q2 18 Renewal rates up 5.6%, representing back-to-back quarters of 5%+ renewal price increases Hybrid Colocation: Hybrid colocation business contributed majority of net leasing volume in the second quarter Completed sales force realignment around hyperscale and hybrid colocation with addition of Clint Heiden as new Chief Revenue Officer, leading hybrid colocation sales and marketing Colocation strength enabled by industry s first software-defined data center platform Growing pipeline of larger footprint opportunities (500kW 2MW) Signed 4 leases between 500kW 2MW in Q2 18 vs. only 2 signed during all of 2017 Hyperscale: In advanced conversations with a number of hyperscale customers across QTS footprint Pleased with hyperscale pipeline and expect to sign at least one additional larger hyperscale deal by the end of the year Hyperscale remains attractive opportunity as strategic growth accelerant Longer-term financial guidance factors in approximately 1 to 3 larger hyperscale deals signed each year

15 QTS Realty Trust, Inc. 14 Visibility Into Future Growth Remains Strong $51M Annualized Booked-Not-Billed Core MRR ($M) 1 $51.3 $51.3 $51.3 $51.3 Highlights $19.9 $14.5 Annualized booked-notbilled core MRR from signed but not yet commenced leases was $51.3 million as of June 30, 2018 Of the $16.9 million in 2018, approximately $5.5 million is expected to be recognized in 2018 revenue $16.9 Of the $19.9 million in 2019, approximately $14.9 million is expected to be recognized in 2019 revenue Q Represents annualized MRR associated with leases that have been signed but have not yet commenced; may not sum due to rounding

16 QTS Realty Trust, Inc. 15 Balance Sheet and Liquidity Summary Capital Structure Highlights Series B Preferred Stock $316M Series A Preferred Stock $107M Market Cap $2,297M 2 $3 $1 $0 $3.8B Enterprise Value Senior Notes $400M Debt Maturities ($M) 3 $0 Unsecured Credit Facility $700M 1 Capital Leases and Other $6M $350 $ Net Debt to LQA consolidated adjusted EBITDA of 4.7x Approximately $870 million of liquidity, including cash and availability under credit facility $51M booked-not-billed backlog of annualized core revenue More than 80% of capital stack subject to a fixed rate 4 Launched a Series B Perpetual Convertible Preferred Stock offering, which resulted in gross proceeds of $316M (net proceeds of $304M) Continue to evaluate a range of financing options including structured financing, JV partnerships, and potential asset divestitures 1. Includes two term loans ($700 million in aggregate) as of June 30, Market Cap calculated as follows: total Class A and Class B common stock and OP units of 58.2 million, multiplied by the June 30, 2018 stock price of $39.50 per share. 3. May not sum due to rounding 4. Including Series A and Series B Preferred Stock

17 QTS Realty Trust, Inc. 16 Improving Credit Profile and Business Visibility Consolidated (Core + Non-Core) Q4 17 Core Business Only Q2 18 Weighted Average Remaining Customer Lease Term (Months) Weighted Average Remaining Top 10 Customer Lease Term (Months) Lease Expirations as a % of Total Annualized MRR Through % 38% Signed Backlog as a % of Total Annualized MRR 12% 15% Annual Churn 1 8.4% 4.0% 1. Q4 17 reflects full-year 2017 reported results for consolidated business (core + non-core); Q2 18 reflects midpoint of 2018 annual churn guidance for core business of 3-5%

18 Second Quarter 2018 Update

19 QTS Realty Trust, Inc. 18 Strategic Plan to Accelerate Growth and Profitability Accelerate Growth and Leasing 16% Revenue Growth Y/Y* 15% OFFO Per Share Growth Y/Y* $34M Annualized Rent Signed YTD* Increase Profitability $ 52.3% Adj. EBITDA Margin* Highest adjusted EBITDA margin achieved in QTS history Represents 500+ basis points of margin expansion Y/Y Enhance Predictability 0.8% Rental Churn* Among the lowest churn rates in data center industry Churn on track to be approximately half the churn QTS experienced in consolidated business in churn guidance reduced to 3-5% from 3-6% * Reflects Q2 18 results for Core business only

20 QTS Realty Trust, Inc. 19 Strategic Growth Plan Execution Summary Q Core year-over-year revenue growth of 16% Lowered churn guidance on outperformance YTD and visibility into customer activity Core year-over-year OFFO/sh growth of 15% 500+ basis point core adjusted EBITDA margin improvement year-over-year Strongest 1H leasing results in QTS history ($34M of core annualized rent signed YTD) Strategic partnership with GDT tracking ahead of expectations Nearly 300 basis point sequential increase in occupancy Funded 2018 capital plan in shareholderfriendly manner, while minimizing near-term equity dilution Strong booked-not-billed backlog of $51M of annualized core revenue Consecutive quarters of 5%+ renewal rate increases

21 Appendix

22 QTS Realty Trust, Inc. 21 Seamless Connectivity to Hyperscale CSP s and Network Providers Access to 500+ carriers and all major public clouds ~13,000 cross connects Connectivity = 8% of revenue and growing 15%+ year-over-year Peering Exchanges On-Net Carriers On-Net Hyperscalers SD-WAN Providers

23 QTS Realty Trust, Inc. 22 Robust Security & Compliance Capabilities The cyber threat landscape continues to grow with an increasing number and severity of attacks 1 53% cyber attacks resulting in damages $500K+ Differentiated QTS Approach is an Advantage LOGICAL SECURITY Data: Encryption, policy enforcement and security intelligence. 55% companies managing public scrutiny of a BREACH 32% of companies reporting breaches affecting 50%+ OF SYSTEMS PHYSICAL SECURITY Site access and monitoring systems. Breadth of compliance certifications & security capabilities enables QTS to be a trusted partner to Enterprises and Government entities looking to manage increasing cyber risks against their critical systems and data Network: Best-of-breed network infrastructure. Host: Strict security policies, cutting-edge technology and premium support. 24x7x365 on-site security professionals Premium, state-of-the-art owned and operated data centers. Integrated compliance coverage over a breadth of regulations 1. Reflects results from the Cisco 2018 Annual Cybersecurity Report.

24 QTS Realty Trust, Inc. 23 NOI Reconciliation Three Months Ended June 30, 2018 March 31, 2018 June 30, 2017 $ in thousands Core Non-Core Total Core Non-Core Total Core Non-Core Total Net Operating Income (NOI) Net income (loss) $ 5,397 $ (11,830) $ (6,433) $ 5,083 $ (5,335) $ (252) $ 987 $ 3,621 $ 4,608 Interest income (25) (25) (1) (1) Interest expense 8, ,203 8, ,110 7, ,647 Depreciation and amortization 35,233 2,586 37,819 33,340 2,574 35,914 31,294 3,233 34,527 Tax expense (benefit) of taxable REIT subsidiaries 178 (41) 137 (767) (1,635) (2,402) (1,429) (1,429) Transaction, integration and impairment costs General and administrative expenses 18,004 3,028 21,032 18,114 4,119 22,233 17,586 4,976 22,562 Restructuring 11,430 11,430 8,530 8,530 NOI $ 67,639 $ 5,177 $ 72,816 $ 64,792 $ 8,260 $ 73,052 $ 56,232 $ 11,844 $ 68,076

25 QTS Realty Trust, Inc. 24 EBITDAre & Adjusted EBITDA Reconciliation Three Months Ended June 30, 2018 March 31, 2018 June 30, 2017 $ in thousands Core Non-Core Total Core Non-Core Total Core Non-Core Total EBITDAre and Adjusted EBITDA Net income (loss) $ 5,397 $ (11,830) $ (6,433) $ 5,083 $ (5,335) $ (252) $ 987 $ 3,621 $ 4,608 Interest income (25) (25) (1) (1) Interest expense 8, ,203 8, ,110 7, ,647 Tax expense (benefit) of taxable REIT subsidiaries 178 (41) 137 (767) (1,635) (2,402) (1,429) (1,429) Depreciation and amortization 35,233 2,586 37,819 33,340 2,574 35,914 31,294 3,233 34,527 Loss on disposition of depreciated property and/or impairment write-downs of depreciated property 3,122 3,122 4,017 4,017 EBITDAre $ 48,982 $ (6,159) $ 42,823 $ 45,758 $ (372) $ 45,386 $ 38,485 $ 6,868 $ 45,353 Equity-based compensation expense 3,999 3,999 3,481 3,481 3, ,732 Restructuring costs 8,308 8,308 4,513 4,513 Transaction, integration and impairment costs Adjusted EBITDA $ 53,634 $ 2,149 $ 55,783 $ 50,159 $ 4,141 $ 54,300 $ 41,929 $ 7,317 $ 49,246

26 QTS Realty Trust, Inc. 25 FFO, Operating FFO and Adjusted Operating FFO Reconciliation Three Months Ended June 30, 2018 March 31, 2018 June 30, 2017 $ in thousands Core Non-Core Total Core Non-Core Total Core Non-Core Total FFO Net income (loss) $ 5,397 $ (11,830) $ (6,433) $ 5,083 $ (5,335) $ (252) $ 987 $ 3,621 $ 4,608 Real estate depreciation and amortization 33, ,843 31, ,057 29, ,275 FFO 38,490 (11,080) 27,410 36,275 (4,470) 31,805 30,417 4,466 34,883 Preferred stock dividends (2,248) (2,248) (328) (328) FFO available to common shareholders & OP unit holders 36,242 (11,080) 25,162 35,947 (4,470) 31,477 30,417 4,466 34,883 Restructuring costs 11,430 11,430 8,530 8,530 Transaction, integration and impairment costs Tax expense (benefit) associated with restructuring, transaction and integration costs (41) (41) (1,635) (1,635) Operating FFO available to common shareholders & OP unit holders* 36, ,204 36,867 2,425 39,292 30,578 4,466 35,044 Maintenance Capex (2,612) (2,612) (930) (930) (1,170) (1,170) Leasing commissions paid (7,600) (71) (7,671) (5,839) (71) (5,910) (3,417) (638) (4,055) Amortization of deferred financing costs and bond discount Non real estate depreciation and amortization 2,140 1,836 3,976 2,148 1,709 3,857 1,864 2,388 4,252 Straight line rent revenue and expense and other (1,300) 67 (1,233) (2,509) (9) (2,518) (566) (71) (637) Tax expense (benefit) from operating results (767) (767) (1,429) (1,429) Equity-based compensation expense 3,999 3,999 3,481 3,481 3, ,732 Adjusted Operating FFO available to common shareholders & OP unit holders* $ 32,661 $ 2,141 $ 34,802 $ 33,413 $ 4,054 $ 37,467 $ 30,114 $ 6,594 $ 36,708 *The company s calculations of Operating FFO and Adjusted Operating FFO may not be comparable to Operating FFO and Adjusted Operating FFO as calculated by other REITs that do not use the same definition

27 QTS Realty Trust, Inc. 26 MRR Reconciliation Three Months Ended June 30, 2018 March 31, 2018 June 30, 2017 $ in thousands Core Non-Core Total Core Non-Core Total Core Non-Core Total Recognized MRR in the period Total period revenues $ 102,549 $ 9,728 $ 112,277 $ 100,390 $ 13,307 $ 113,697 $ 88,740 $ 19,128 $ 107,868 Less: Total period recoveries (10,444) (10,444) (11,513) (11,513) (8,693) (81) (8,774) Total period deferred setup fees (3,073) (130) (3,203) (2,888) (5) (2,893) (1,972) (464) (2,436) Total period straight line rent and other (2,022) (2,304) (4,326) (3,899) (552) (4,451) (2,500) (806) (3,306) Recognized MRR in the period 87,010 7,294 94,304 82,090 12,750 94,840 75,575 17,777 93,352 MRR at period end Total period revenues $ 102,549 $ 9,728 $ 112,277 $ 100,390 $ 13,307 $ 113,697 $ 88,740 $ 19,128 $ 107,868 Less: Total revenues excluding last month (67,701) (6,861) (74,562) (66,790) (8,871) (75,661) (58,510) (12,752) (71,262) Total revenues for last month of period 34,848 2,867 37,715 33,600 4,436 38,036 30,230 6,376 36,606 Less: Last month recoveries (3,597) (3,597) (3,107) (3,107) (2,859) (13) (2,872) Last month deferred setup fees (984) (99) (1,083) (962) (2) (964) (742) (80) (822) Last month straight line rent and other (745) (1,139) (1,884) (1,669) (382) (2,051) (487) (734) (1,221) MRR at period end $ 29,522 $ 1,629 $ 31,151 $ 27,862 $ 4,052 $ 31,914 $ 26,142 $ 5,549 $ 31,691

28 QTS Realty Trust, Inc. 27 Core & Non-Core Reconciliation Three Months Ended Three Months Ended Three Months Ended $ in thousands except per share values June 30, 2018 March 31, 2018 June 30, 2017 Selected Income Statement Data Core Non-Core Total Core Non-Core Total Core Non-Core Total Total Revenues $ 102,549 $ 9,728 $ 112,277 $ 100,390 $ 13,307 $ 113,697 $ 88,740 $ 19,128 $ 107,868 Less: Operating costs 34,910 4,551 39,461 35,598 5,047 40,645 32,508 7,284 39,792 Net operating income 67,639 5,177 72,816 64,792 8,260 73,052 56,232 11,844 68,076 Less: General & administrative expenses (excluding equity-based compensation expense) Adjusted EBITDA Less: Equity-based compensation expense Interest income Interest expense Tax expense (benefit) from operating results Non real estate depreciation and amortization Preferred stock dividends Operating FFO available to common shareholders & OP unit holders 14,005 3,028 17,033 14,633 4,119 18,752 14,303 4,527 18,830 53,634 2,149 55,783 50,159 4,141 54,300 41,929 7,317 49,246 3,999 3,999 3,481 3,481 3, ,732 (25) (25) (1) (1) 8, ,203 8, ,110 7, , (767) (767) (1,429) (1,429) 2,140 1,836 3,976 2,148 1,709 3,857 1,864 2,388 4,252 2,248 2, , ,204 36,867 2,425 39,292 30,578 4,466 35,044 OFFO per share $ 0.64 $ 0.01 $ 0.64 $ 0.64 $ 0.04 $ 0.68 $ 0.55 $ 0.08 $ 0.63 Adjustments: Transaction, integration and impairment costs Restructuring costs (653) (653) (920) (920) (161) (161) (11,430) (11,430) (8,530) (8,530) Tax benefit associated with restructuring, transaction and integration costs ,635 1,635 Real estate depreciation and amortization (33,093) (750) (33,843) (31,192) (865) (32,057) (29,430) (845) (30,275) Preferred stock dividends 2,248 2, Net income (loss) $ 5,397 $ (11,830) $ (6,433) $ 5,083 $ (5,335) $ (252) $ 987 $ 3,621 $ 4,608 Note: Per share values may not sum due to rounding