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Related Party Transactions

6 Months Ended

Jun. 30, 2020

10. Related Party Transactions

As described further in Note 5 – ‘Investments in Unconsolidated Entity’, during the six months ended June 30, 2019, QTS formed an unconsolidated entity with Alinda, an infrastructure investment firm. QTS contributed a hyperscale data center under development in Manassas, Virginia to the entity. The facility, and the previously executed operating lease to a global cloud-based software company pursuant to a 10-year lease agreement, was contributed in exchange for cash and noncash consideration in the form of equity interest in the entity that was measured at fair value pursuant to ASC Topic 820. QTS and Alinda each own a 50% interest in the entity.

Under the unconsolidated entity agreement, we serve as the entity’s operating member, subject to authority and oversight of a board appointed by us and Alinda, and separately we serve as manager and developer of the facility in exchange for management and development fees. QTS earned $0.4 million and $0.2 million in development fees from the unconsolidated entity during the three months ended June 30, 2020 and 2019, respectively, and $0.9 million and $0.4 million for the six months ended June 30, 2020 and 2019, respectively. In addition, QTS earned approximately $0.2 million and $0.2 million in management fees from the unconsolidated entity during the three months ended June 30, 2020 and 2019, respectively, and $0.4 million and $0.2 million for the six months ended June 30, 2020 and 2019, respectively.

In addition, we periodically execute transactions with entities affiliated with our Chairman and Chief Executive Officer. Such transactions include automobile, furniture and equipment purchases as well as building operating lease payments and receipts, and reimbursement for the use of a private aircraft service by our officers and directors.

The transactions which occurred during the three and six months ended June 30, 2020 and 2019 are outlined below (unaudited and in thousands):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2020		2019		2020		2019
Tax, utility, insurance and other reimbursement	$	78	$	174	$	254	$	435
Rent expense		257		253		514		507
Capital assets acquired		-		370		-		424
Total	$	335	$	797	$	768	$	1,366