Meta Putting $2B In Data Center Land Up For Sale To Fund AI Infrastructure
Meta is on the hunt for new ways to foot the bill for the company's $72B artificial intelligence infrastructure plans, including selling off some of its portfolio.
The tech company in June reclassified $2B of land and construction sites as held for sale, Reuters reported, citing Meta's earnings report. Meta is looking to sell them to a third party within the next year and then execute data center development partnerships on the tracts.
Reclassification valued the properties at the lower end of their carrying amounts or fair value. They weren’t stated at a loss and are worth $3.2B.
Meta execs said last week that they plan to spend $72B on data centers in 2025, raising the lower end of the company's capital expenditures guidance by $2B. CEO Mark Zuckerberg said Meta’s capex could grow to more than $100B next year.
Meta is in an AI arms race with other tech companies like Amazon and Google and AI developers like OpenAI. Combined, the four biggest tech companies are on track to close $400B in capex this year, mostly toward the construction of data centers and supporting infrastructure.
That is sending construction and power costs skyrocketing. Construction materials are facing supply chain issues and have increased by nearly 20%.
The social media company plans to self-fund most capex. But for some ventures, it is exploring ways to secure financing.
That could come in the form of a nearly $30B data center fund.
Apollo Global Management, KKR, Brookfield, Carlyle Group and Pimco were in talks with Meta to provide funding, it was reported in June. Meta was hoping to raise $3B through private equity investment and $26B in debt, and it was reportedly exploring ways to structure the debt to make it easily tradable.
Meta is one of the largest global data center end users and operates 28 of its own data center campuses in addition to leasing many others.
Its pipeline includes a controversial 4M SF campus in Richland Parish, Louisiana. It will be the firm’s biggest and will be powered by a nearby natural gas power plant. The company is also investing more than $1.6B to build campuses in Wisconsin and Bowling Green, Ohio.
