GI Partners, a private equity firm, investing through its GI Real Estate Essential Tech+Science Fund, today announced the acquisition of a 46-megawatt, 238k sqft hyperscale data center, known as Cloud Plaza, in the Northern Virginia sub-market of Sterling, Virginia. Specifically, GI Partners acquired a majority ownership interest in the property from Sentinel Data Centers, a data center operator, which is owned by Rabina Properties, a real estate investment and development firm based in New York. In turn, Sentinel Data Centers will retain a minority ownership interest in the Cloud Plaza property.

Transaction Details

On May 19, 2022, GI Partners, through the entity GI TC Loudoun LLC, acquired this data center for $709m from Sentinel Data Centers’ entity, Sentinel Ashburn II LLC. Based on the facility’s 46 megawatts of power capacity, this implies that GI Partners paid $15.4m per megawatt for the data center.

Cloud Plaza – GI Partners, Sentinel Data Centers

GI Partners’ Cloud Plaza data center is located at 22262 Cloud Plaza in Sterling, Virginia, at the southwest corner of the intersection of Waxpool Road and Route 28. More specifically, the facility is within the building envelope closest to Pacific Boulevard and Moran Road – marked as (1) in the map below.

Site Map 22262 Cloud Plaza Sterling Virginia

The Cloud Plaza data center – marked as (1) above – is constructed on 23.8 acres of land. Presently, the facility offers over 46 megawatts of critical power across 238k sqft.

Directly in front of Cloud Plaza and signified by the blue “Data Centers” box and arrows is Vantage Data Centers’ 42-acre Ashburn, Virginia campus, known as VA1. At full build-out, Vantage’s $1bn Ashburn campus will house five multi-story facilities, offering 146 megawatts of critical IT load across 1+ million square feet.

Additionally, the box with a red asterisk next to Moran Road is the proposed location for a substation, while the green box to its west is an existing cemetery.

History

In July 2017, Sentinel Data Centers acquired the entire 65-acre plot of land (shown above) for $25.2m, equivalent to $388k per acre, from Verizon – who had gained the land through its acquisition of AOL. Subsequently, in October 2017, Vantage Data Centers announced that it had secured 42 acres of land in Ashburn, Virginia – presumably acquiring it from Sentinel.

Following separation of these land interests, Sentinel Data Centers pursued a distinct planning application for its Cloud Plaza data center, which was approved in 2018. Finally, by 2019, the facility was delivered and fully commissioned.

Customer

GI Partners and Sentinel’s Cloud Plaza data center is leased to a global technology firm which is a “credit tenant”, implying a long-term lease agreement with an investment grade (or equivalent) tenant.

Transaction Advisor

Sentinel Data Centers and Rabina Properties were represented by CBRE Data Center Capital Markets.

GI Partners – Overview

GI Partners is a San Francisco-based private equity firm, which has raised over $33bn in capital. Particularly, the firm’s three primary strategies include private equity, real estate, and data infrastructure. Within digital infrastructure, GI Partners owns stakes in Flexential, One Wilshire (CoreSite-occupied), LightEdge Solutions, and single-tenant data centers in Manassas, Virginia, which are leased to Amazon Web Services (AWS).

GI Real Estate Essential Tech+Science Fund

GI Partners’ GI Real Estate Essential Tech+Science Fund is an open-end, core plus real estate investment vehicle with $1.45bn in total capital commitments. Furthermore, through this fund, GI Partners intends to build a portfolio of data centers, life sciences buildings, and research & development facilities, which will provide a combination of income and growth.

Mary Zhang covers Data Centers for Dgtl Infra, including Equinix (NASDAQ: EQIX), Digital Realty (NYSE: DLR), CyrusOne, CoreSite Realty, QTS Realty, Switch Inc, Iron Mountain (NYSE: IRM), Cyxtera (NASDAQ: CYXT), and many more. Within Data Centers, Mary focuses on the sub-sectors of hyperscale, enterprise / colocation, cloud service providers, and edge computing.

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