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Stonecourt Capital Snaps Up 365 Data Centers Amid Growing Consolidation

Private equity firm Stonecourt Capital plans to acquire 365 Data Centers, one of the largest privately owned data center providers focused in the eastern U.S., in a year of heightened deal-making in the data center industry. 

Florida-based 365 Data Centers operates hybrid data center services in 12, mostly “edge” markets: Boca Raton, Florida; Bridgewater, New Jersey; Buffalo, New York; Chicago; Long Island, New York; Detroit; Fort Lauderdale, Florida; Indianapolis; Nashville; Philadelphia; New York City; and Tampa, totaling 23K SF and 22 megawatts of power. 

Total data center deal volume is on track to well outpace 2019’s totals.

"[The deal] will enhance our ability to execute on our organic and acquisition growth strategies,” said 365 CEO Bob DeSantis, who will remain at the helm. Terms of the deal weren’t disclosed. 

With COVID-19 boosting data center demand, Stonecourt’s buyout of 365 Data Centers is the latest in a series of notable buyouts and high-dollar fundraising in the sector. 

Earlier this week, colocation provider Vantage Data Centers, which builds and leases data center space to major tech firms like Facebook, said it raised $1.3B in securitized debt, citing an “extremely advantageous” environment for fundraising and refinancing, said Vantage Chief Financial Officer Sharif Metwalli in a statement. Vantage operates six facilities in North America and plans to use some of the funding for new construction. 

Another colocation provider, Stack Infrastructure, raised $325M in securitized debt in September, citing an uncommonly low interest rate of 1.893%, the lowest securitized rate ever seen in the data center industry. 

“We’ve seen unprecedented levels of investor demand, which stands as a testament to the company’s credible growth strategy and our ability to support the accelerated momentum of the hyperscale and cloud data center market," Stack Infrastructure CFO Heather Paduck said.

Stack Instractructure operates several massive data center campuses spanning the U.S., including a multi-story San Jose-based facility, currently under construction, that the company says is 100% pre-leased. Other locations include Phoenix, Chicago, Atlanta, Portland and Virginia. 

DataBank, another large U.S. colocation provider, announced plans to acquire zColo from Zayo Group Holdings last month, bringing its total holdings to 64 data centers in 29 markets upon closure of the deal. 

Total data center deal volume is on track to well outpace 2019’s totals.  

In April, Synergy Research Group noted that total data center mergers and acquisitions had already reached $15B, exceeding last year’s deal volume just in the first four months of the year, and forecast a “bumper year” for data center deals.