Blackstone's data center REIT raises $1.75 billion through US IPO

Source: Global Market Report

A newly established data center real estate investment trust fund (REIT) under Blackstone Group announced on Wednesday that it has raised $1.75 billion in its initial public offering (IPO) in the United States.

The Blackstone Digital Infrastructure Trust will focus on acquiring newly built data centers. The IPO offered 87.5 million shares at $20 per share.

This year, companies related to artificial intelligence have led the U.S. IPO market, as investors bet on the widespread adoption of this technology bringing strong growth.

The fund plans to invest in data centers located in markets such as Northern Virginia, Ohio, Phoenix, Maryland, and Austin, with a value ranging from $250 million to $1.5 billion, leased to investment-grade hyperscale tenants.

The fund has identified and evaluated recent opportunities worth approximately $25 billion in established data markets.

Data centers provide the essential infrastructure for storing, processing, and analyzing massive amounts of information, which is critical for training artificial intelligence models.

Blackstone Group is an active investor in the data center and digital infrastructure sector. Its portfolio includes more than $150 billion in data center assets globally.

The company privatized the data center operator QTS Realty Trust in 2021 for approximately $10 billion.

An affiliate of Blackstone Group had expressed intent to invest up to $200 million in this IPO. As an incentive, each IPO investor received incentive shares equivalent to 1% of their investment.