DataBank Raising $665M By Securitizing 36 Data Centers

Data center firm DataBank is looking to raise $665M by securitizing a big portfolio of colocation data centers, the latest in a series of asset-backed securities transactions in the sector. 

The Dallas-based data center provider plans to issue asset-backed securities backed by a $4.2B portfolio of multitenant retail colocation data centers and their related tenant contracts, according to a presale report from Moody's Ratings.

Spread across 14 different U.S. markets, the 36 facilities span more than 1.6M SF and offer 258 megawatts of total capacity. They are leased to more than 1,750 tenants. 

While asset-backed securities have emerged as an increasingly central component of the data center financing landscape, DataBank’s offering is unusual in that it is backed by a large number of multitenant facilities rather than the handful of single-tenant hyperscale assets that typically anchor such transactions. 

Moody's describes the data centers backing the deal as being “of strong quality” and well-suited to the evolving needs of both hyperscale and enterprise tenants amid the artificial intelligence arms race. 

“The data centers are located in urban locations, with low latency and dense connectivity making them attractive to growing real-time applications, financial trading applications and AI inferencing,” Moody’s analysts wrote. 

DataBank, acquired in 2016 by DigitalBridge, is one of the largest data center operating platforms in the world, with a portfolio of 73 properties totaling 877 MW of inventory in more than 25 metro areas.

DataBank has traditionally focused on multitenant colocation for a variety of enterprise and Big Tech customers, although the company also operates single-tenant facilities purpose-built for tech giants such as Amazon, Microsoft and Google. 

The firm operates 65 sites within the United States, making DataBank the U.S. colocation provider with the largest geographic presence, according to Moody’s.

This geographic diversity is reflected in the portfolio of data centers backing its latest ABS offering, which includes facilities in Houston, Dallas, Salt Lake City, Atlanta, Chicago, Minneapolis, Pittsburgh, Kansas City, Indianapolis, Las Vegas, Denver, Los Angeles, Cleveland and San Diego.

The 36 data centers are collectively 84% leased to a wide range of tenants, including hyperscalers, large technology companies and other enterprise customers, signed to 12,065 individual contracts.

Seven of these facilities are carrier hotels: connectivity-focused multitenant data centers located at the nexus of multiple telecom cable routes that effectively serve as a switching station for internet traffic. Proximity to these facilities is often a key consideration when siting new data centers. 

This isn't DataBank’s first time utilizing asset-backed debt to raise funds. With five prior securitizations and $3.2B in outstanding ABS debt, the company has raised more funds through ABS than any other third-party data center provider, according to Charles River Associates.

DataBank's most recent ABS transaction was in September, when the firm raised $1.067B by securitizing three fully leased data centers — two of them single-tenant, hyperscale facilities — in Northern Virginia, Atlanta and New York.

These deals come amid a flood of data center-backed ABS and commercial mortgage-backed securities offerings, which in just four years have gone from obscurity to a primary tool through which data center development is financed. 

ABS loan activity increased sharply in 2025, with issuance volumes roughly doubling every year since 2020, according to JLL. The brokerage expects this trend to accelerate in 2026, with issuances of structured debt tied to data centers potentially reaching $50B. 

Yet even as ABS becomes the norm for the data center industry, offerings like DataBank’s upcoming securitization — backed by a large portfolio of retail multitenant data centers rather than a handful of single-tenant hyperscale facilities — are unusual.

Moody’s Ratings Assistant Vice President Terrence Donohue said there are only five issuers of colocation transactions, with roughly five to 10 such offerings each year. Many of those deals, like DataBank’s September offering, are small portfolios anchored by single-tenant assets. 

The large, diversified portfolio backing DataBank’s new debt issuance presents different risks compared to the stabilized hyperscale facilities backing most data center ABS deals, according to Donohue. 

On one hand, colocation portfolios have much higher diversity both in terms of geographic location and tenants, which reduces the risk that an environmental event or the performance of one tenant will derail their performance.

On the other hand, while most hyperscale facilities backing ABS deals have tenants locked into long-term contracts of 10 years or more, in DataBank’s latest transaction, approximately 45% of the contracts have initial terms that expire prior to the end of the year.

“[C]olocation portfolios have much shorter contract/lease terms (generally 2-5 years) which may introduce the portfolio to higher levels of volatility in the performance,” Donohue said in an email to Bisnow. 

He added that some retail colocation data centers carry greater obsolescence risk compared to newer hyperscale builds, as “colocation properties tend to be older and more established, whereas hyperscale facilities are newer and more built-to suit for hyperscalers and their workflow needs, such as cloud.”