Brookfield Infrastructure Partners (NYSE: BIP) released its Form 20-F, detailing the firm’s data segment, which holds the company’s investments in digital infrastructure. Collectively, Brookfield Infrastructure’s global portfolio comprises 158.1k operational telecom towers & active rooftop sites, 50+ data centers, and 13.7k miles (22.0k kilometers) of fiber-optic cable. Below, Dgtl Infra details Brookfield Infrastructure’s 8 major investments in the three key sub-sectors of digital infrastructure, namely towers, data centers, and fiber:
Brookfield Infrastructure – Digital Portfolio Summary
|Portfolio Company||Sub-Sector||Geography||Key Metrics|
|TDF Infrastructure||Towers||France||8k towers, 31k fiber miles|
|Wireless Infrastructure Group||Towers||UK||2.1k towers, 70 DAS|
|Summit Digitel||Towers||India||148k operational towers|
|Evoque Data Center||Data Centers||U.S.||31 data centers|
|DCI Data Centers||Data Centers||Australia||2 data centers|
|Ascenty||Data Centers||Brazil||28 data centers|
|BAM Digital Realty||Data Centers||India||Two land parcels|
|Vodafone New Zealand||Fiber||NZ||7.5k fiber miles, 1.6k sites|
Additionally, Brookfield, investing through its Super Core-infrastructure fund has made investments in Telia Company’s towers in Finland, Norway, and Sweden.
Towers – Brookfield Infrastructure Portfolio
Brookfield Infrastructure, through its portfolio companies TDF Infrastructure, Wireless Infrastructure Group (WIG), and Summit Digitel Infrastructure, together operate 158.1k telecom towers and rooftop sites, for customers including telecommunications companies, in France, the UK, and India.
TDF Infrastructure is the second largest independent tower operator in France (behind Cellnex). The company operates ~8.0k multi-purpose towers & active rooftop sites and 31.1k miles (50.0k kilometers) of fiber in France. Specifically, the business has three primary segments: i) telecom site hosting, ii) wholesale fiber-to-the-home (FTTH) networks, and iii) television and radio broadcasting.
Through its towers, TDF Infrastructure is supporting greater requirements from wireless carriers due to increased demands for network densification. While in fiber, TDF has participated in government-led initiatives to provide lower population density areas in France with access to high-speed broadband through the deployment of FTTH networks. To this end, TDF has secured four tenders and is currently engaged in the roll-out and commercialization of fiber networks to over 730k households and businesses across France.
Brookfield Infrastructure invested in TDF Infrastructure in March 2015.
Operations in 2021
For the 12-months ending June 30, 2021, TDF Infrastructure reported revenue of €719.2m and EBITDAaL (EBITDA after Leases) of €402.3m. Therefore, the company’s EBITDAaL margin was 55.9%.
During full-year 2021, TDF Infrastructure constructed ~250 towers and added ~180k new fiber-to-the-home (FTTH) passings. As of December 31, 2021, total capital to be commissioned by TDF was ~$175m for the purposes of rolling-out its FTTH network and additional points-of-presence (PoPs) in France.
Wireless Infrastructure Group
Wireless Infrastructure Group (WIG) is the second largest independent tower operator in the UK, excluding mobile network operator (MNO) joint ventures. The company operates ~2.1k active telecom towers, in rural and suburban areas, and over 70 distributed antenna systems (DAS), primarily in the UK. Particularly, the business has three main segments: i) telecom site hosting and services, ii) indoor networks, and iii) fiber (for small cell networks).
Through its telecom towers, WIG is supporting wireless carriers in meeting the UK government’s 95% 4G coverage target by 2025. Additionally, a significant percentage of the company’s towers are in rural areas of the UK, which will benefit from future colocation given limited alternative sites in these areas.
Finally, WIG’s indoor networks business growth drivers include: i) increased data demand, ii) higher frequency 5G spectrum, and iii) limited deployment presently, as only 30% of the addressable indoor market has a system in-place.
Brookfield Infrastructure invested in Wireless Infrastructure Group in December 2019.
Summit Digitel Infrastructure
Summit Digitel Infrastructure (formerly Reliance Jio Infratel) is the second largest independent tower operator in India (behind Indus Towers). The company operates ~148k telecom towers in India which are able to provide pan-India 4G coverage.
Summit Digitel’s towers form the network backbone of Reliance Jio (Jio), India’s largest wireless carrier. Indeed, Jio is an anchor tenant of Summit Digitel under a 30-year master service agreement (MSA).
Overall, India is one of the world’s largest data consumers, despite having just 68% of wireless subscribers in the country connected to 4G networks. Moreover, the average traffic per smartphone in India is projected to grow to ~50 gigabytes per month by 2027, from 18.4 gigabytes per month in 2021, representing an 18% CAGR.
Brookfield Infrastructure invested in Summit Digitel Infrastructure in August 2020.
Operations in 2021
During the quarter ended December 31, 2021, Summit Digitel reported total revenue of ~$324m (24.1bn Indian Rupees). Therefore, on an annualized basis, Summit Digitel produces ~$1.29bn of total revenue.
Over the 12-months ending December 31, 2021, Summit Digitel added ~11.5k contracted build-to-suit (BTS) towers. As of December 31, 2021, total capital to be commissioned by Summit Digitel was ~$130m for the purposes of building-out additional contracted towers.
In 2022, the company has committed arrangements to construct ~26.0k additional towers, which are supported by anchor tenant Reliance Jio.
Data Centers – Brookfield Infrastructure Portfolio
Brookfield Infrastructure, through its portfolio companies Evoque Data Center Solutions, DCI Data Centers, Ascenty, and BAM Digital Realty, together operate 50+ data centers, with ~200 megawatts of critical load capacity across ~1.4 million sqft of raised floor space. Geographically, these data centers are located in countries including the United States, Australia, Brazil, and India.
Collectively, Brookfield Infrastructure’s data center operations serve ~1,000 colocation customers, predominantly in the United States – given that Evoque (see below) is a retail colocation provider. In Asia-Pacific and South America, the company’s data centers serve mainly global hyperscale customers.
Evoque Data Center Solutions
Evoque Data Center Solutions is a retail colocation provider, primarily in the United States, which was formed through a carve-out of 31 data centers from AT&T. Geographically, Evoque’s data centers span the U.S. markets of Ashburn, Atlanta, Boston, Chicago, Dallas, Los Angeles, New Jersey, Phoenix, San Diego, San Francisco, San Jose, and Seattle. Additionally, the company’s international locations include Amsterdam, Netherlands; Frankfurt, Germany; Redditch, UK; and Singapore.
In terms of connectivity, Evoque’s facilities provide pre-built access to the AT&T global network and link to over 300 carrier connection points globally.
Brookfield Infrastructure invested in Evoque Data Center Solutions in December 2018.
Operations in 2021
In 2021, Brookfield Infrastructure attributed declines in adjusted EBITDA and FFO of its broader data storage business to “customer churn at our U.S. data center business as we reposition the business for new growth initiatives” – referencing Evoque.
DCI Data Centers
DCI Data Centers is a wholesale data center operator in Australia which owns and operates two facilities in Sydney and Adelaide, Australia. As of December 31, 2021, these data centers have a combined utilization of 91% and a weighted average remaining contract life of 9 years.
Additionally, the company has four further sites under development in Sydney and Adelaide, Australia, as well as Auckland, New Zealand – where its first facility is now fully leased. In Sydney, DCI’s announced pipeline comprises >40 megawatts of power capacity. Finally, DCI has secured its first data center development site in Seoul, South Korea and a second greenfield location in Auckland, New Zealand.
Brookfield Infrastructure invested in DCI Data Centers in January 2019.
Ascenty is a wholesale data center operator, primarily in Brazil, which is owned through a joint venture between Digital Realty and Brookfield Infrastructure. Geographically, Ascenty’s 28 data centers span São Paulo, Brazil; Rio de Janeiro, Brazil; Fortaleza; Brazil; Santiago, Chile; and Querétaro, Mexico. Of the company’s 28 data centers, 19 are operational and 9 are under development.
Brookfield Infrastructure invested in Ascenty in March 2019.
Operations in 2021
During 2021, Ascenty reported $204.7m of revenue and $128.8m of net operating income (NOI). Additionally, as of December 31, 2021, Ascenty had total assets of $2.08bn.
In 2021, Ascenty commissioned 11 megawatts of power capacity. Moreover, the company anticipates that a further 28 megawatts of power capacity will be commissioned in 2022. Finally, at its Investor Day, Brookfield Infrastructure noted that Ascenty could reach >200 megawatts of power capacity and generate >$300m of EBITDA by 2025.
BAM Digital Realty
BAM Digital Realty is a 50%/50% joint venture between Digital Realty and Brookfield Infrastructure to develop and operate hyperscale data centers in India. To-date, Brookfield Infrastructure has invested ~$5m to establish the business and begin acquiring land for future development. Presently, BAM Digital Realty has acquired land in Navi Mumbai and Chennai, India for the purposes of data center development.
Overall, Brookfield Infrastructure notes that the BAM Digital Realty joint venture is targeting development of a data center portfolio with 300 megawatts of power capacity over the next 5 to 7 years. In turn, Brookfield Infrastructure expects to deploy $1bn of capital through the BAM Digital Realty joint venture portfolio.
Brookfield Infrastructure invested in BAM Digital Realty in September 2021.
Fiber – Brookfield Infrastructure Portfolio
Brookfield Infrastructure owns ~6.2k miles (~10.0k kilometers) of fiber backbone located in France and Brazil. Additionally, Brookfield Infrastructure, through a joint venture with Infratil Limited, owns Vodafone New Zealand (VNZ), which serves retail, wholesale, and enterprise customers in New Zealand with fiber and towers.
Vodafone New Zealand (VNZ)
Vodafone New Zealand (VNZ) operates 7.5k miles (12.0k kilometers) of fiber-optic cable and ~1.6k cell sites in New Zealand. Through VNZ’s integrated data distribution business, the company provides wireless network operation and broadband services to ~2.6 million connections and has ~1.8 million Internet of Things (IoT) connections.
VNZ supports ~98% of New Zealand’s population with network coverage and is the second largest fixed broadband provider with ~20% market share. Additionally, VNZ has launched commercial 5G services in New Zealand.
Brookfield Infrastructure invested in Vodafone New Zealand in July 2019.