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Tishman Speyer To Develop Its First Data Center

A planned data center from Tishman Speyer will mark two firsts for the New York-based investment and development firm. 

Tishman Speyer is pushing into data centers as it looks to diversify its real estate portfolio.

Tishman Speyer announced it has reached an agreement to buy an 18.5-acre site in Frankfurt, Germany, where it plans to build a data center with an eventual 70-megawatt capacity. The plan is the firm’s first foray into data centers and its first industrial project in Europe. 

Tishman reached an agreement with Mainova WebHouse GmbH, a subsidiary of German power supplier Mainova AG, that gives the energy company an option to become a partner on the development. 

“We're excited to partner with Mainova WebHouse as we enter the data center space,” Tishman Speyer CEO Rob Speyer said in a statement. “This project aims to bring new capacity online just as the computing power requirements of AI need it most. This is a model transaction for future investments we look to make in this growing sector.”

The data center is slated to be built in Frankfurt's Osthafen area on a site the developer acquired from Samson, an industrial automation firm relocating to Offenbach. Terms of the deal weren't disclosed, but negotiations for the acquisition began last January, according to a release.

The acquisition will be made through Tishman Speyer’s European TSEV IX value-add fund, which launched in February 2022 with €600M in capital raised ($647M) and a €1B target.

The data center will be part of a master-planned development that also includes light industrial buildings that will take advantage of “high demand notably from logistics and retail sector clients” in the Rhine-Main region, according to a release.

The developer didn’t provide a construction timeline but said the data center would initially have a 32 MW load that would be expanded to 70 MW. 

The site, near a critical exchange point for internet infrastructure, is “in this fast-growing market where there continues to be high demand from hyperscaler clients for new capacity,” the release says. 

Tishman Speyer has more than $50B in assets under management globally, with a concentration in office projects, along with some retail, residential, hotel, life sciences and warehouse investments. 

The Frankfurt project reflects the firm’s belief that data center development is “one of the most attractive sectors for the ongoing diversification of its business portfolio,” the release says. 

Data centers have become prime investment targets for developers and funds as the rapid expansion of services driven by artificial intelligence increases global computing power needs

Starwood Capital Group spent $850M in February for a 50% stake in Ireland-based Echelon Data Centres as part of its plan to invest between $2B and $3B into the sector.  

BlackRock has inked a roughly $12.5B deal to acquire Global Infrastructure Partners, an infrastructure fund manager whose assets include more than 50 data centers in the U.S. and Europe. 

Amazon is investing $11B to build its own data center campus in northern Indiana, and Blackstone is also going big in the sector, investing $8B into its QTS Data Centers subsidiary and creating a $7B joint venture with Digital Realty to develop 10 hyperscale data centers in the next six years.   

“The scale of the data center opportunity is immense,” Blackstone Real Estate Global co-Head Nadeem Meghji told Bisnow in March. “It's the single most exciting strategy we have globally today.”