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Starwood Bags $850M Stake In Irish Data Center Developer


Starwood Capital Group, already a major player in the data center space, is upping its game in the property type by acquiring a 50% stake in Echelon Data Centres for $850M, which will also provide funding for Echelon's expansion.

Ireland-based Echelon specializes in large-scale facilities across its home country and the UK. The company has about 140 megawatts of capacity either operational or in late stage construction, including a 91.4 MW hyperscale facility in Dublin.

Starwood Capital, which has about $115B in assets under management, launched a dedicated data center fund in January, Starwood Digital Ventures, to further its expansion into data centers, though the Echelon deal was funded through  Starwood Opportunity Fund XII and Starwood Real Estate Income Trust.

Starwood Capital has made roughly $8B in data center investments over the last five years, not counting the latest deal, totaling 1.5 gigawatts in various stages of development. The investor is one of the largest privately held data center developers in the United States and Europe.

Deutsche Bank and Morgan Stanley advised Starwood Capital in the deal, while Eastdil Secured and Nomura advised Echelon. The Irish data center company will be further capitalized for growth through a new $969M debt facility provided by Morgan Stanley and United Overseas Bank.

Other major investors have made sizable forays into data centers recently, such as BlackRock, which inked a deal in January to acquire Global Infrastructure Partners. That company has over $100B in assets under management, including CyrusOne, a hyperscale data center platform with more than 50 data centers.

Related Topics: Starwood Capital Group, Echelon