New York-based Related Cos. launched a data center business that the developer says already has a $45B near-term development pipeline.

Related Digital, as the venture is known, is launching with $500M in commitments and an executive team of Related veterans and new hires from the industrial and data center sectors. Related wants to raise $8B for the business as part of a multiphase effort set to open in the back half of this year.

“Digital infrastructure is one of the most remarkable growth categories and asset classes that I have seen in my more than 35 years in real estate development," Related Cos. CEO Jeff Blau said in a statement.

Blau is CEO of the Related Digital venture, and Brent Behrman is joining as chief investment officer, leaving his chief sales officer role at global data center developer CyrusOne. Greg Myers, the former global head of capital at Vista Equity Partners, is the firm’s chief financial officer.

The company’s first project is a 64-megawatt data center expansion in Ontario, Canada, that is set to deliver this summer. Its pipeline includes more than 5 gigawatts of projects in the U.S. and Canada, including a Chicago development for PsiQuantum that is set to host the world’s largest quantum computer, according to Related.

Related Digital's near-term development pipeline includes 1.2 GW in Missouri, 1 GW in Illinois and 250 MW in Wyoming.

The venture will fit into the broader Related Cos. family by having its investment activities led through Related Fund Management, the company’s real estate private equity and credit investment management arm.

“Related Digital's vertically integrated business model and unmatched expertise across the entire data center value chain positions the business to be a leading player in the data center space, and I look forward to playing a role in spearheading its rapid and sustained growth,” Myers said in a statement.

Related Cos. is bringing in other professionals from across the sector to work at and advise the venture. Erik Egger is leaving industrial giant Prologis to focus on design and construction, and John Shine will join from Compass Datacenters.

The first three members of Related Digital's advisory board are Bill Stein, co-founder of Digital Realty Trust, Phil Horstmann, founder of data center firm Ascent, and Miguel Prado, CEO of renewable energy firm energyRe.

Related Digital is positioned as a provider of complex, differentiated solutions focused on artificial intelligence and cloud hyperscalers.

Investors and tech firms have poured billions of dollars into data center development, leading developers specializing in other property types to dive in.

Prologis launched its own $8B data center business last year, and President Donald Trump’s two oldest sons partnered with a New York-based investment firm to launch their own data center venture in February.

The massive amount of capital is being spent to support nascent AI technology that corporate executives expect will lead to huge productivity gains, but many early business implementations have fallen flat, sometimes with embarrassing results.

The lack of real-world, profitable applications has led to fears that a bubble has formed.

Joe Tsai, the billionaire chairman of Chinese conglomerate Alibaba Group Holding Ltd., said at a conference this month that he saw a bubble forming, especially in the U.S.

“I think in a way, people are investing ahead of the demand that they’re seeing today, but they are projecting much bigger demand,” Tsai said.