Davidson Kempner European Partners and Pioneer Point Partners, through a joint venture called Start Campus, today announced a €3.5bn investment to build a 450-megawatt hyperscale data center campus in Sines, Portugal, named SINES 4.0. Specifically, the data center campus will comprise five buildings, each with 90 megawatts of power capacity.

The campus in Sines, which is located 55 miles (89 kilometers) south of Lisbon, Portugal will be fully built-out by 2025. Indeed, construction is scheduled to begin in 2022 and the SINES 4.0 facility anticipates opening the first of its five buildings by the end of 2023.

Notably, both Davidson Kempner and Pioneer Point are key shareholders in Echelon Data Centres, which has six facilities under development in the UK and Ireland. Therefore, today’s announcement showcases another example of both firm’s focus on data center investing in Western Europe.

SINES 4.0 – Start Campus – Davidson Kempner and Pioneer Point

Davidson Kempner and Pioneer Point note that the scalability of the SINES 4.0 hyperscale data center campus in Portugal, beyond 450 megawatts, is a highlight of the investment. Specifically, Sines offers numerous land options, in close proximity, for an extension of the data center facilities.

Beyond growth, renewable energy and innovative cooling systems are also unique to Davidson Kempner and Pioneer Point’s Start Campus joint venture in Portugal.

Renewable Energy

The SINES 4.0 data center campus will have access to low-priced renewable energy, through connectivity to the national power grid via private substation. Specifically, the campus has available solar, wind, and hydro energy. Additionally, it has the potential to be a hydrogen and biomethane user in the future. Finally, SINES 4.0 intends to use batteries to store energy and increase its overall resilience from an energy perspective.

Cooling Systems

Given the location of Sines, Portugal on the coast of the Atlantic Ocean, the data center campus expects to use ocean water as part of the cooling systems for its servers. Indeed, this form of cooling is low-cost, highly-efficient, and environmentally-friendly. Additionally, SINES 4.0 aims to re-use waste heat from its data center by serving the needs of neighboring industrial customers.

Subsea Cables – Portugal

Portugal’s unique geographic location has positioned the country as a central landing point for numerous subsea cables which connect Europe, Africa, South America, and the Middle East. Specifically, these subsea cables include EllaLink, 2Africa, Equiano, and Main One.

  • EllaLink: connects Portugal to Brazil (Fortaleza and São Paulo)
  • Equiano: connects the entire African continent to Europe, via Portugal, with funding from Google Cloud
  • 2Africa: connects the entire African continent to Europe, via Portugal, with funding from a consortium including Facebook, Orange, and Vodafone

Overall, Sines has a unique seabed topology given that it sits on a continental shelf. In turn, this topology positions Sines as an ideal location for new subsea cable landings. Specifically, Sines is an advantageous location because subsea cables can safely and cost-effectively land at its shores. Greater subsea cable activity will bring a richer ecosystem of tenants to Davidson Kempner and Pioneer Point’s facility in Portugal.

Subsequently, terrestrial fiber then provides onward connectivity to the rest of Europe, through Portugal and Spain. Indeed, these are two of the cheapest countries in Europe to build fiber, enhancing their attractiveness from a connectivity standpoint.

Government of Portugal – Support for Davidson Kempner and Pioneer

In March 2021, Davidson Kempner and Pioneer Point’s SINES 4.0 project was granted the status of being a Project of National Interest (PIN) by AICEP Global Parques of Portugal. Indeed, all relevant licensing bodies have given their pre-approval to the project and will expedite licensing of SINES 4.0. Moreover, a government committee was set-up to ensure the project’s development and achievement of full licensing by end of 2021.

Portugal – Data Center Projects Grow

Today’s announcement of the Start Campus joint venture, closely follows an earlier declaration by Merlin Properties in Portugal. Indeed, Merlin Properties, the largest REIT in Spain and Portugal, plans to build a data center facility in Lisbon, Portugal. Specifically, Merlin intends to build a hyperscale data center in Lisbon with 20 megawatts of power capacity in Phase I. Furthermore, the firm anticipates scaling the project to have a total potential power capacity of 100+ megawatts.

Mary Zhang covers Data Centers for Dgtl Infra, including Equinix (NASDAQ: EQIX), Digital Realty (NYSE: DLR), CyrusOne (NASDAQ: CONE), and CoreSite Realty (NYSE: COR). Within Data Centers, Mary focuses on the sub-sectors of hyperscale, enterprise / colocation, cloud service providers, and edge computing.

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