Blackstone and Digital Realty team up in $7bn JV

Digital Realty is a cloud- and carrier-neutral data centre, colocation and interconnection provider.

  • Digital Realty’s data centre campuses are located in Frankfurt, Paris and Northern Virginia
  • The campuses are planned to support the construction of 10 data centres
  • Digital Realty will manage the development and day-to-day operations of the joint venture

Blackstone-affiliated funds led by Infrastructure, Real Estate and Tactical Opportunities have agreed to establish a joint venture with Digital Realty. Blackstone will acquire an 80 percent ownership interest in the joint venture for approximately $700 million of initial capital contributions, while Digital Realty will maintain a 20 percent interest.

The aim of the joint venture is to develop four hyperscale data centre campuses across three metro areas on two continents. Austin, Texas-based Digital Realty will manage the development and day-to-day operations of the joint venture.

The four hyperscale data centre campuses are located in Frankfurt, Paris and Northern Virginia and have a total estimated development cost of approximately $7 billion. The campuses are planned to support the construction of 10 data centres with approximately 500 MW of potential IT load capacity.

“Data centres are experiencing once-in-a-generation demand growth, driven by cloud adoption and the AI revolution,” said Jon Gray, president & COO of Blackstone. “Digital infrastructure is one of our highest conviction investment themes as a firm, and this transaction with a trusted data centre operator in Digital Realty is another example of how we are investing behind this trend.”

Blackstone is an alternative asset manager with $1 trillion in assets under management. The firm is based in New York.