New York-based developer company, Related, has announced it to invest $8 billion in developing data centers in North America. This decision is being taken by the company considering the emerging AI and cloud hyperscale technologies demand, which has reached the level of obsession for tech companies. In an interview, Related’s CEO Jeff Blau commented,
“What we saw was this incredible demand for data center development by tech companies. The demand is so great, and we have all the execution capabilities.”
Related Digital
Through its data center development project ‘Related Digital’, the company aims that
‘With a $45 billion development pipeline of more than 5 gigawatts (GW) of near-term power across the United States and Canada, Related Digital has the capabilities, depth of expertise and national scale to bring differentiated solutions to global hyperscalers’
The company hired Brent Behram as chief investment officer of Related Digital, formerly an executive at data center developer CyrusOne.
The investment activities of the venture will be led by Related Fund Management, a real estate private equity and credit investment manager.
While commenting on the initial stage of the venture, the company’s CEO stated
“We took this team we put together and immediately went around the country, met with utilities and different sources around the country, and found pockets of power still remaining around the grid and tied up that power as fast as we possibly can,”
Morgan Stanley, the American multinational investment bank and financial services company, is currently advising Related on the first phase of the project and the first capital is expected to be committed after June this year.
First Data Center
Related is planning to develop its first North American data center in Ontario, Canada. This data center is being developed for a hyperscale customer.
Data Centers Development Race
Related Companies has initiated this project to compete in the global tech race that is currently investing in AI technology after the launch and success of OpenAI’s ChatGPT. Since then, tech giants including Google, Microsoft and Amazon have invested in developers of data centers like Equinix and Blackstone’s QTS.
Impact of Data Centers on Power Companies
As the data centers development race has pace up, power companies have also geared up to meet the high electricity demands. For this purpose, new power plants and transmission lines are being built.
According to Data Center Knowledge, some developers have indicated that to will consume up to five gigawatts of electricity, a demand that is equal to the consumption of a complete city.
Considering the successful ventures of Related Companies and the high demand for data centers, it seems that the developer company has taken a timely decision. Related Digital seems a very promising venture as tech companies are heavily investing in AI and Cloud technologies. This venture will not only give a boost to the developer company but also seem like a win-win situation for power companies, tech investors, and AI consumers.
