Realty Income and Partners Invest $1.4B in Hyperscale Data Centers

Realty Income Teams Up with Cloud Capital and Global Investor to Invest in Data Centers

Realty Income Corporation, known for distributing monthly dividends, has unveiled a partnership with Cloud Capital and a global institutional investor. This collaboration is set to channel investments into a collection of hyperscale data centers, leasing to top-rated tenants under long-term agreements.

Realty Income, alongside its partners, plans to invest in a trio of well-placed data center assets, all leased to significant hyperscale clients. This strategic joint venture not only aims to capitalize on the growth of digital infrastructure but also sets a foundation for future data center investments in both the United States and Europe.

Realty Income's President and CEO, Sumit Roy, stated, "Today's announcement affirms the strength of our business model and its ability to translate across sectors, including digital infrastructure." Meanwhile, Cloud Capital’s CEO, Hossein Fateh, highlighted the synergy, saying, "Partnering with Realty Income and the Global Investor brings together the capital and the operating expertise to meet that demand and to extend our leadership in the sector."

Investment Details

The collaboration will see Realty Income dedicating up to $1.4 billion, with an initial outlay of approximately $700 million expected between the second and third quarters of 2026. Initially, Realty Income will secure a 45% stake in a stabilized hyperscale data center asset in Northern Virginia, a pivotal market location. As part of the ongoing agreement, Realty Income will also hold interests in two other projects currently in development, contingent on specific milestones being met.

These data centers, situated in one of the world’s largest data center hubs, are secured under 15 to 20-year lease agreements. These agreements are with top-tier hyperscale tenants and feature built-in annual rent escalations. Such arrangements underscore the long-term significance of Realty Income's portfolio.

Advisors and Future Prospects

With Moelis & Company LLC advising and Latham & Watkins LLP as legal counsel, Realty Income is poised to leverage this venture to explore further investments in digital infrastructure. Similarly, Goldman Sachs & Co. LLC and Jones Day are advising Cloud Capital.

In line with the investment, Cloud Capital, with its global presence in managing data center assets, will provide management services for the portfolio. Meanwhile, CloudHQ, a leading data center developer, will oversee property and development management tasks.

About the Companies

Realty Income, an S&P 500 company founded in 1969, is recognized for its consistent monthly dividends and has accumulated a diverse portfolio across the U.S., U.K., and Europe. Cloud Capital, since 2020, has managed a global portfolio valued at over $12 billion, while CloudHQ is known for partnering with major tech companies to offer reliable data center infrastructures.

For further insights and future updates from Realty Income, visit their website at www.realtyincome.com. More information about Cloud Capital can be accessed at www.cloudcapital.com.

Forward-Looking Statements

This news release contains forward-looking statements that inherently involve risks and uncertainties. These statements, identifiable by terms like "anticipate," "expect," and "intend," reflect current insights and expectations. Potential risks include market fluctuations, competition, and economic conditions which could affect actual results. Further information is detailed in Realty Income's filings with the U.S. Securities and Exchange Commission.

For the original press release, please visit: https://www.prnewswire.com/news-releases/realty-income-forms-programmatic-joint-venture-with-cloud-capital-and-a-global-institutional-investor-to-invest-in-hyperscale-data-centers-initial-seed-assets-valued-at-over-6-billion-302815077.html