These days, PE firms have a lot of interest in data centers. And there’s a number of reasons why. One of them being digital transformation. Another is ESG considerations. GI Partners is active in this space.
Any deal with an ESG element will be valuable to PE firms. And data centers have become increasingly attractive to investors over the years. GI Partners calls its recent deal for 22262 Cloud Plaza in Virginia a “highly networked and energy efficient data center” in the largest data center market in the U.S.
“We are seeing increased net absorption for data center capacity broadly, and users placing premium value on locating at network-differentiated assets like Cloud Plaza,” says GI Partners managing director John Sheputis. “We believe that the addition of this fortress-like asset to our data center portfolio will reduce our overall risk while providing accretive returns over the long-term.”
In April, GI Partners raised $1.45 billion for its GI Real Estate Essential Tech+Science Fund. Among other properties, the fund will look for data center acquisitions. So clearly the PE firm is not done dealmaking in this space.
With the combination of remote work and more companies moving tech services to the cloud, data centers have become a key element for business operations. Add those that are energy efficient, data centers will continue to catch the eyes of buyers.
I wouldn’t be surprised if we see more deals happening.
– Demitri Diakantonis