Corporate Office Properties Trust (COPT) today completed the second and final close of its $293m Northern Virginia data center joint venture with Blackstone Real Estate. Specifically, Blackstone acquired a 90% interest in six Northern Virginia data center shell properties that comprise 979k sqft and were valued at $203m.
As part of the sale, COPT received ~$84m of equity value from the transaction for its 40% interest. Indeed, the remaining equity value was distributed to GI Partners, a private equity firm, who held a 50% interest in these assets.
COPT and Blackstone Real Estate – Formation of Joint Venture
In November 2020, COPT formed the $293m joint venture with Blackstone. Specifically, the joint venture acquired interests in eight Northern Virginia single-tenant, data center shell properties. Overall, these facilities total 1.3 million sqft at a valuation of $293m.
At this prior time, Blackstone closed on the acquisition of a 90% interest in two of these data center shell properties, valued at $90m. Therefore, with today’s announcement of six more data centers closed, Blackstone has completed the acquisition of all eight data centers from COPT.
COPT – Data Center Portfolio
Overall, COPT owns 25 single-tenant data center shell properties, which comprise 350+ megawatts of power capacity and 4.5 million sqft. Specifically, COPT owns 15 of these data center shells, comprising 2.5 million sqft, through real estate joint ventures. Indeed, COPT fully owns the remaining 10 data center shells, comprising 2.0 million sqft.
Additionally, COPT’s data center portfolio includes one wholesale data center, with a critical load of 19.3 megawatts. Finally, COPT owns one data center shell that is currently under development.
COPT – Demand from Hyperscale Cloud Service Providers
COPT focuses its data center builds on large footprint, build-to-suit facilities for the hyperscale cloud service providers. Specifically, Amazon Web Services (AWS) has been a key tenant for COPT’s Northern Virginia data centers. Indeed, the COPT and Blackstone joint venture anticipates further leasing from Amazon Web Services (AWS) in Northern Virginia.
Overall, Amazon Web Services (AWS) has leased 4.5 million sqft of data center space from COPT in Northern Virginia. In total, Amazon Web Services (AWS) pays $56.0m of annual rent, which comprises 10% of COPT’s annual rental revenue. Notably, these leases with Amazon Web Services (AWS) are long duration, having a remaining lease term of 9.4 years.
