Digital Realty Trust (DLR) presents a deeply negative liquidation recovery posture as of March 31, 2026, consistent with the prior period. Total assets of $48.9 billion are dominated by long-lived, operationally encumbered real estate and intangibles that attract significant haircuts under a forced-sale scenario, while liabilities remain at face value. The largest asset class, net real estate investment property ($26.9 billion gross PP&E net of $10.4 billion accumulated depreciation, yielding $26.9 billion net), would receive a 50-70% recovery haircut, implying a liquidation range of roughly $13.4-18.8 billion against book. Goodwill of $9.6 billion receives a 0% recovery — this alone eliminates roughly $9.6 billion of book equity in a winding. Finite-lived intangibles (net $1.7 billion) also recover at 0%. The Ascenty and other unconsolidated JV investments ($3.5 billion book) have uncertain recovery and are likely worth less than book in a distressed sale. On the liability side, senior unsecured notes total $16.0 billion, secured debt $0.8 billion, revolving credit $0.7 billion, operating lease liabilities $1.2 billion, deferred tax liabilities $1.1 billion, accounts payable and accrued liabilities $2.4 billion, and preferred stock liquidation preference $755 million — all at face value. The $3.2 billion open construction commitments represent a contingent liability that would crystallize in liquidation. Redeemable noncontrolling interests (temporary equity) of $1.6 billion rank ahead of common equity. MFFAIS CLV is reported at negative $14.8 billion, consistent with this structure. Compared to the prior 10-K (December 31, 2025), the key changes are: (1) $875 million ATM equity issuance in Q1 2026 adds cash but also grows the development pipeline (1,169 MW under construction, up 52% from year-end 2025), which increases both gross PP&E and committed construction obligations; (2) consolidated debt increased modestly, driven by Euro notes issued in mid-2025 now fully reflected; (3) cash position of $2.4 billion provides near-term liquidity buffer but is insufficient to offset the liability stack in a true liquidation. The asymmetry between haircut assets and face-value liabilities produces a large negative equity recovery, characteristic of capital-intensive REIT structures. No impairment charges or goodwill write-downs were recorded in Q1 2026.
▼ Community Notes