Subsequent Events

9 Months Ended

Sep. 30, 2020

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

In October 2020, we paid our regular quarterly cash dividends on our common stock, Series A Preferred Stock and Series B Preferred Stock. See the ‘Dividends and Distributions’ section of Note 9 for additional details.

In September 2020, through our subsidiaries, the Operating Partnership and QTS Finance Corporation (collectively, the “Issuers”), we conducted a private offering without registration rights of $500 million aggregate principal amount of senior notes due October 1, 2028 (the “2028 Senior Notes”). The 2028 Senior Notes have an interest rate of 3.875% per annum and were issued on October 7, 2020 at a price equal to 100% of their face value. The Notes will mature on October 1, 2028. The net proceeds from the offering were used to repay a portion of the amount outstanding under our unsecured revolving credit facility. Subsequently, we gave notice that we will redeem the 4.750% Senior Notes on November 16, 2020 and will use the corresponding availability under our unsecured revolving credit facility, along with additional borrowings from Term Loan D (discussed below), to satisfy and discharge the indenture. As a result of early repayment of the Senior Notes, we expect to incur early redemption fees equal to 3.563% of the aggregate principal amount, or approximately $14.3 million. Additionally, the deferred financing costs associated with the 4.750% Senior Notes, which were approximately $3.9 million as of September 30, 2020, will be written off at the time of repayment.

In October 2020, through our Operating Partnership, we entered into a $250 million term loan (“Term Loan D”) that provides for commitments to make a single term loan borrowing of up to $250 million on or before November 16, 2020. We intend to draw the entire $250 million on or before November 16, 2020. Term Loan D will mature on January 15, 2026. Interest rates on Term Loan D can vary based on leverage levels consistent with our existing term loans as discussed in Note 6. As of the date of this report, the interest rate on Term Loan D is LIBOR plus 1.2% and includes a LIBOR floor of 25 basis points. When combined with our current $1.7 billion unsecured credit facility, Term Loan D increases QTS' aggregate unsecured credit facility capacity to $1.95 billion. Term Loan D also provides for a $250 million accordion feature to increase Term Loan D up to $500 million, subject to obtaining additional loan commitments.