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)