Equinix and PGIM Real Estate Enter into a US$575 Million JV to Extend Hyperscale Data Center Program into Australia
The facilities in the joint venture, which will be known as SY9x and SY10x, are expected to provide more than 55 megawatts (MW) of power capacity to serve the unique core workload deployment needs of a targeted group of hyperscale companies, including the world's largest cloud service providers. The first xScale data center in
To date, six xScale data centers have been opened in
Equinixis the leading data center provider in Australiawith 17 International Business Exchange™ (IBX®) data centers, which will increase to 18 when PE3 in Perthopens later this year.
- Under the terms of the agreement,
PGIM Real Estatewill control an 80% equity interest in the joint venture, and Equinixwill own the remaining 20% equity interest. The joint venture is expected to close in Q4 2021, pending regulatory approval and other closing conditions.
- As one of the largest real estate managers in the world,
PGIM Real Estatewill contribute market insight and support to the joint venture with its deep knowledge of local real estate equity and debt markets applied through its 1,100+ experienced professionals across 31 offices worldwide. By deploying research-led initiatives such as this new program with Equinix, PGIM Real Estatestrives to deliver exceptional performance for both its partners and investors. Structure Researchforecasts that hyperscale colocation market in Sydneyand Melbourne, in terms of built-out critical MW capacity, will grow at a compound annual growth rate (CAGR) of 22% from 2021 to 2026.1 With xScale data centers in Australia, hyperscale companies can add core deployments to their existing access-point footprints at Equinix, enabling their growth on a single platform that can immediately span 65 global metros and offer direct interconnection—within robust ecosystems—to their customers and strategic business partners.
- Currently, Platform Equinix® features more than 40% of the private on-ramps to the top global cloud service providers—more than any other provider. For years, the world's largest cloud service providers, including
Alibaba Cloud, Amazon Web Services, Google Cloud, IBM Cloud, Microsoft Azure and Oracle Cloud Infrastructure, have partnered with Equinixto leverage its global platform of more than 230 data centers to directly connect to their strategic business partners and customers. With the xScale program, these hyperscalers can continue to grow at Equinix, in close proximity to an ecosystem of 10,000 customers.
- According to an independent Global Tech Trends report released by
Equinixin May this year, which surveyed 2,600 IT decision-makers across 26 countries, hybrid and multicloud deployments in Australiawere trending up from 28% to 47% year-on-year.2 The xScale program in Australiawill enable enterprises to directly connect and operate in proximity to the largest global cloud operators to build and grow their hybrid multicloud infrastructure. Equinixis a leader in data center sustainability and is greening the supply chains of its customers. Equinixis the first data center operator to commit to reaching climate-neutral by 2030 globally, backed by science-based targets and a sustainability innovation agenda. The company's long-term goal of using 100% clean and renewable energy for its global platform has resulted in significant increases in renewable energy coverage globally. Most recently, Equinix, together with HSBC Bank, Nike Australia, Goldman Sachs and Hennes & Mauritz (H&M), also received determination from the Australian Competition and Consumer Commission(ACCC) for joint renewable energy purchasing in Australia. Equinixhas continued to make advancements in the way it designs, builds and operates its data centers with high energy-efficiency standards, and all xScale data centers are expected to be LEED certified (or the equivalent regional certification).
- Citi served as exclusive financial advisor to
Equinixin connection with this transaction.
Jabez Tan, Head of Research, Structure Research:
Australiais set to build out its next wave of capacity, with the hyperscale market expected to grow about double the rate of the retail segment by 2026. There have been unprecedented levels of cloud adoption in the country. Equinix'sexpansion into Australia'shyperscale market is a timely move to address the aggressive demand among hyperscalers in Australiaand will further accelerate digital transformation in the country." Eric Adler, Chief Executive Officer, PGIM Real Estate:
"We are extremely pleased to partner with
Equinixon this investment in Sydney, and we look forward to expanding this strategic relationship in other markets, thereby providing our investors further access to the increasingly important digital infrastructure sector. This is a highly symbiotic venture between two market-leading firms with complementary business models and global capabilities." Charles Meyers, President and CEO, Equinix:
"As digital transformation accelerates across all industries, hybrid multicloud is becoming the IT architecture of choice for leading businesses. These companies recognize that digital infrastructure is a source of competitive advantage, and they are leveraging Platform Equinix to directly connect and operate close to the largest cloud companies powering this infrastructure. Our new relationship with
PGIM Real Estatefollows our successful partnership with GIC and will enable the world's largest hyperscalers to expand within the Equinixecosystem in Australia."
- Hyperscale Data Center Expansion Goes into Hyperdrive [Equinix Blog]
Equinixand GIC to Add $3.9Bto Expand xScale Data Center Program [press release]
- Hyperscale Connectivity Drives
$3 Billionin Data Center Projects by Equinixand JV Partners[press release] Equinixand GIC to Form Greater than US$1.0 BillionJoint Venture to Develop and Operate Hyperscale Data Centers in Japan[press release] Equinixand GIC Complete Formation of Greater than US$1.0 BillionEuropean Data Center Joint Venture [press release]
- How Hyperscale Data Centers Can Power Cloud Provider Success [Equinix Blog]
- Learn more about Platform Equinix [website]
As one of the largest real estate managers in the world with
This press release contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from expectations discussed in such forward-looking statements. Factors that might cause such differences include, but are not limited to, risks related to
3 As of
4 Includes legacy lending through PGIM's parent company,
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