“Capital is Following Leasing” | Domestic Investment Opportunities Round-Table at CAPRE’s Mid-Atlantic Data Center Summit

LEESBURG, VA – CAPRE’s Seventh Annual Mid-Atlantic Data Center Summit explored many sides of the data center capital markets arenas. One of the concluding panels, titled “Domestic Investment Opportunities: How Have Growth Market, Sale Leaseback, and Sources of Investments Funds Changed in 2019 versus 2018?” dove deep into a few topics that have been grabbing headlines recently. For example, about halfway through the panel, Moderator Sami Badri, Senior Analyst at Credit Suisse asked panelist Dan Bryson, Executive Vice-President of Finance at JLL to shine some light on how the big picture is changing. “Dan, can you both chime in on how lease terms have evolved over the last five years?” asked Badri. “What was the hot line-item you saw five years ago and what is it today?” “Well the difference in this current environment is the impact of the Internet of Things and the dynamic growth of this business,” replied Bryson. “2018 was a huge year across the Tier I markets, and in some case Tier II and tertiary markets as well. 2019 is a little bit below that. I think we’re at 11 megawatts versus where we were in 2018, so we’re a little bit behind. But nonetheless, capital and the banks on our side -- on the debt side -- is following the leasing. If you don’t have the leasing…you have to underwrite around that. And you can’t just assume that with a 10 year loan, that that…