Building upon its reputation as a leading global infrastructure company, Brookfield Infrastructure Partners has announced its ambitious plans to significantly expand its data center capacity. With the upcoming acquisitions of Data4 and Compass, the company aims to establish itself as one of the largest global hyperscale data center platforms in the world.
Increase in Data Center Capacity
In a strategic move to fortify its position in the data center market, Brookfield Infrastructure Partners will witness a substantial increase in its overall data center capacity. The addition of Data4 and Compass will bring its capacity to over 485 MW, strengthening its ability to meet the growing demand for data storage and processing.
Expansion Plans
With the closing of both transactions, Brookfield Infrastructure Partners has solidified its future growth trajectory in the data center industry. In addition to the contracted and reserved 775MW capacity, the company plans to develop another 1.25 gigawatts of capacity over the next few years. This expansion will bolster its ability to provide stable cash flow, as the increased capacity is underpinned by major hyperscale customers.
Self-Funded Structure
In a move to ensure sustainable growth and fund its capital backlog, Brookfield Infrastructure Partners has devised a self-funded structure. This innovative approach involves monetizing its operating and contracted data centers. By leveraging the cash flow generated from these centers, the company can fund its capital investments and drive further expansion. To further support the growth ambitions of its customers, Brookfield Infrastructure Partners holds a significant land bank in prime markets. This land bank has the potential to increase the company’s total capacity to over two gigawatts, opening up vast opportunities for future expansion.
Partnership and Ownership
The acquisition of Compass was made in partnership with the Ontario Teachers’ Pension Plan, underscoring Brookfield Infrastructure Partners’ commitment to strategic collaborations. While the company does not own all of the data centers outright, this partnership brings valuable expertise and resources to the table, strengthening its position in the market.
Expected Yields and Growth
Brookfield Infrastructure Partners anticipates initially earning single-digit going-in yields from its recent data center investments. However, these yields are expected to grow significantly as the company develops its highly visible and large-scale growth pipeline. This growth trajectory is projected to increase the company’s EBITDA by over 5x compared to the previous year.
Geographic Footprint Expansion
The acquisitions of Compass and Data4 have not only increased the company’s overall capacity but also expanded its geographic footprint. The Compass deal has provided Brookfield Infrastructure Partners with a greater presence in North America, while the acquisition of Data4 has strengthened its foothold in Europe. These strategic expansions enable the company to serve a broader range of customers and cater to diverse market needs.
Brookfield Infrastructure Partners’ ambitious plans to expand its data center capacity position the company as a formidable player in the global hyperscale data center market. With over 485MW of capacity and a robust pipeline for future development, the company is poised for substantial growth. Supported by its self-funded structure and strategic partnerships, Brookfield Infrastructure Partners aims to deliver superior returns and meet the evolving demands of the digital era.