GI Partners Bets on Baltimore Data Centers
Private equity firm GI Partners has acquired two data centers in the Baltimore area, capitalizing on the intense demand for digital infrastructure driven by AI and cloud adoption. The deal underscores the high-multiple environment for data center assets as investors race to secure capacity.
The acquisition totaled $221.9 million for two recently built data centers, with seller Harrison Street providing the portfolio. The properties are the 109,455-square-foot Sandy Farms Data Center in Severn, Md., and the 110,336-square-foot Eternal Rings Data Center in Laurel, Md. To finance the transaction, GI Partners secured a $113.4 million loan from Capital One. This deal brings GI Partners' extensive data infrastructure portfolio to 78 properties. The firm, a major player in the sector for over two decades, has invested more than $8 billion in digital infrastructure assets to date. Their strategy often focuses on acquiring operating businesses with existing management teams where they can add value, a playbook honed since their first data center investment in 2001 which eventually became the publicly traded REIT, Digital Realty. The two data centers are 100% leased to a single, unnamed user. This aligns with a common strategy of securing long-term leases with creditworthy tenants, making the assets more attractive to institutional investors. The facilities are strategically located within the Baltimore-Washington Corridor to serve demand from government, defense, and regulated cloud users. The Baltimore-Washington region is a growing data center hub, serving as an alternative to the highly congested Northern Virginia market, the world's largest concentration of data centers. While Northern Virginia faces land scarcity and power constraints, the Baltimore area offers proximity to key federal agencies and a strong network infrastructure. Maryland also provides a sales and use tax exemption on qualified data center equipment, enhancing its appeal.
