CoreSite Realty Corporation (NYSE:COR) Q2 2020 Earnings Conference Call - Final Transcript

Jul 30, 2020 • 12:00 pm ET

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CoreSite Realty Corporation (NYSE:COR) Q2 2020 Earnings Conference Call - Final Transcript

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Presentation
Executive
Paul Szurek

data center deployments. Our customers have been able to operate in our data centers with significantly reduced physical visits.

Utilization of our customer portal has nearly doubled since the beginning of the pandemic as customers use the portal to provision new space, power and cross connects, remote hands and monitor their temperature, humidity and power draw. We have moved in an agile manner to hosting virtual events and virtual data center tours for current and prospective customers, which have increased our sales funnel, and our sales team is hard at work to ultimately translate those opportunities into sales. We continued our COVID operating protocol so that the recent spike in cases and the related regulatory constraints have not affected our ability to remain fully operational. Turning to our property development. The completion of Phase I of CH2 is a significant milestone.

CH2 is unique in downtown Chicago with its ability to support high-density cabinets with dark fiber campus cross-connects to our CH1 network node, with energy efficient and sustainability focused, construction features and in the downtown market. The addition of CH2 vastly strengthens the attractiveness to enterprises of our Chicago ecosystem, which already provides extensive network options, including leading network providers deployed natively at CH2 and the 40-plus domestic and international carriers as well as access to cloud on ramps at CH1. COVID has affected pre-leasing at CH2, but the enterprise sales funnel that exists today is exactly what we hope to attract with CH2, and we feel good about its future. In addition, we completed the final phase of our SV8 development, adding 52,000 net rentable square feet and six megawatts of capacity to our Silicon Valley campus.

In total, this data center is 74% leased after only nine months since the completion of Phase I, which demonstrates the strong demand in the Santa Clara market and the strength of our campus ecosystem. The completion of these projects provide sufficient capacity to turn up services quickly. We expect Phase I of our LA3 ground-up development, which is 74% pre-leased to a hyperscale deployment to be delivered early in the fourth quarter. Completion remains dependent on the local jurisdictions and utility providers for workplace rules and final inspections and permitting as they operate in COVID conditions. In closing, we believe the sustained adaptability and strong execution of our team, the strategic nature of our diverse network and cloud-dense campuses and the interoperability we enable for a large and diverse customer ecosystem position us well to benefit further from the secular tailwinds for data center space and steady enterprise migration to powerful hybrid cloud solutions and colocation.

With that, I will turn the call over to Steve.

Executive
Steven Smith

Thanks, Paul, and hello, everyone. I'll start off reviewing our quarterly sales results and then discuss some key themes and drivers for the quarter. As Paul shared, we signed $3.5 million of annualized GAAP rent during the second quarter, comprised of 22,000 net rentable square feet at an average GAAP rate of $156 per