Blackstone, an international investment firm, and Digital Realty, a data center real estate trust, recently said they will jointly create a new joint venture to develop $7 billion worth of data centers, with plans to build 10 data centers in Frankfurt, Paris and Virginia, among other regions, targeting ** content, cloud services and artificial intelligence providers. Data is regarded as the "new oil" in the digital economy era, and as a "warehouse" for storing data, data centers are becoming a hot new area for real estate investment.
Data centers, also known as "commercial real estate in the data world", are asset-heavy operations, and the barriers to entry are much higher than those of traditional real estate. One of the major characteristics of the data center is that it is highly professional, requires a professional team to operate and manage, and the development and operation logic is different from that of residential real estate and commercial real estate. Moreover, the initial investment is huge, including the cost of purchasing or leasing land, the cost of purchasing cabinets, and the cost of supporting infrastructure such as air conditioning and power supply.
The partnership between Blackstone and Digital Realty is a win-win situation for both parties and demonstrates strong confidence in the growth prospects of the data center industry. Digital Realty now has more data center investment opportunities than it can afford to capitalize on for rapid expansion, which led it to join forces with Blackstone to finance new developments. At the same time, the joint venture has prompted Blackstone to invest more in the digital infrastructure sector. Jonathan Gray, chief operating officer of Blackstone Group, said that driven by cloud computing and artificial intelligence, data centers have ushered in a rare opportunity for demand growth. Digital infrastructure is one of Blackstone's strongest investment themes.
Computing power is a key infrastructure for the development of the digital economy, and the rapid development of artificial intelligence has brought about a rapid increase in the demand for computing power. According to Grand View Research, the global data center construction market was valued at approximately USD 213.5 billion in 2022, and the global data center construction market size is expected to expand to USD 371.9 billion by 2030 to weigh at an annual rate of 7Rapid growth at a CAGR of 4%.
In the coming years, the world will need huge data center capacity to support digitalization and artificial intelligence development, and data center construction is becoming a hot new area of investment. Blackstone decided in 2021 to spend $6.7 billion to acquire data center provider QTS. At present, its valuation has soared to about $20 billion, nearly three times that of Blackstone, and is considered one of the most profitable single real estate investments. According to the analysis, the construction of data centers is similar to the warehouses built in the early stage of e-commerce development, and generative AI relies on powerful data processing capabilities and extensive storage capacity, which will give rise to a huge demand for data centers. (Sun Yajun).
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*:Economy**.