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Digital Realty and Blackstone Announce Joint Venture for $7 Billion Hyperscale Data Center Development

Digital Realty, the largest global provider of cloud- and carrier-neutral data center solutions, has partnered with Blackstone Inc. to establish a groundbreaking joint venture focusing on developing four hyperscale data center campuses across Europe and North America. The venture, led by Blackstone-affiliated funds specializing in Infrastructure, Real Estate, and Tactical Opportunities, aims to meet the burgeoning demand for colocation near me and server colocation near me services in strategic metro areas.

This collaboration anticipates delivering an impressive 500 megawatts of IT capacity upon completion of all campuses. Blackstone will hold an 80% ownership stake, injecting approximately $700 million as initial capital contributions, while Digital Realty will retain the remaining 20% interest. The parties involved will proportionately fund the remaining development costs after closure.

Comprising locations in Frankfurt, Paris, and Northern Virginia, these four hyperscale data center campuses boast an estimated total development cost of $7 billion, scheduled for realization over the forthcoming years. The ambitious plan outlines the construction of 10 data centers, projecting a potential IT load capacity of approximately 500 MW. Presently, 46 MW is underway and already 33% pre-leased, while the remaining land capacity is in various stages of pre-construction, poised to meet evolving customer demands for diverse data center locations.

CEO Andy Power expressed his enthusiasm about this collaboration, citing Blackstone’s stature as the world’s largest alternative asset manager, emphasizing its pivotal role in catering to the escalating needs of hyperscale customers seeking reliable server colocation near me options. Greg Wright, Digital Realty’s Chief Investment Officer, highlighted the partnership’s alignment with their funding strategy, aiming to diversify capital sources for capitalizing on future opportunities in colocation near me and data center locations.

Jon Gray, President & COO of Blackstone, echoed the significance of this transaction, emphasizing the exponential growth of data centers in the wake of cloud adoption and AI advancements. Blackstone Infrastructure’s Senior Managing Director, Greg Blank, and Blackstone Real Estate’s Managing Director, Mike Forman, both underlined Blackstone’s financial prowess and extensive sector experience, positioning them to harness the burgeoning data growth in collaboration with Digital Realty.

The joint venture, subject to regulatory approvals and customary closing conditions, is slated for completion in two stages within the first half of 2024.

Explore data center locations and colocation near me services on colocapacity.com/map for more information.