A cable community connectivity rack. Digital Realty’s services in Ashburn supply purchasers entry to greater than 160 cloud and community service suppliers. Picture by Taylor Vick by way of Unsplash
Digital Realty has entered right into a $1.5 billion three way partnership settlement with TPG Actual Property Companions. The worldwide colocation and interconnection supplier will promote an 80 % stake in three stabilized knowledge facilities in Ashburn, Va. Kirkland & Ellis LLP suggested the client within the transaction.
TPG made the funding by its newest opportunistic actual property fairness fund, TPG Actual Property Companions IV. The fund closed in October with $6.8 billion in secured commitments.
Digital Realty expects to achieve $1.3 billion of gross proceeds from the three way partnership and related financing. These funds might be used to pay debt, transaction-related bills and for different functions.
The three hyperscale knowledge facilities have a mixed IT capability of 104 megawatts and are leased to investment-grade prospects. The services are valued at a cap fee of 6.0 %, primarily based on annualized in-place money web working earnings, signed leases and deliberate move-outs. Digital Realty will proceed to handle their day by day operations.
Digital Realty operates 16 knowledge facilities within the Northern Virginia market, together with those bought to TPG. These services have a mixed capability of 576.9 megawatts and comprise 452,800 sq. ft of complete colocation house.
Surging demand in Northern Virginia
This transaction got here on the heels of one other comparable deal accomplished by Digital Realty final month. The info middle supplier agreed to promote a 65 % curiosity stake in two hyperscale services in Elk Grove Village, In poor health., to GI Companions. That transaction was funded with a $450 million mortgage supplied by Barclays, Citigroup and Morgan Stanley, in accordance with The Actual Deal.
Information proliferation and mass adoption of cloud computing have continued to drive demand for extra space. Though Northern Virginia stays the most important market within the U.S., issues about energy availability have considerably constrained new provide, a CBRE report discovered. Robust demand stored emptiness charges available in the market at a file 1.8 % as of the primary quarter, the identical supply exhibits.
Amongst latest commitments within the area was Amazon’s deliberate $35 billion funding over a interval of 17 years. The e-commerce large’s cloud supplier arm, AWS, will successfully double its presence in Northern Virginia.
