Echelon Data Centres (Echelon), a data center developer in Ireland and the United Kingdom, has secured an investment of approximately USD 850 million from Starwood Capital Group, a global real estate investment company, for its continued expansion. The transaction involves Starwood Capital committing USD 850 million through Starwood Opportunity Fund XII and Starwood Real Estate Income Trust, making it a 50 percent shareholder in Echelon. The investment values Echelon at around EUR 2.5 billion enterprise value.
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Echelon's Growth and Capacity
Founded in 2016, Echelon provides large-scale facilities to meet the growing global demand for data and computing resources. Echelon currently has 140 MW of capacity either operational or in late-stage construction, including a fully pre-committed 91.4 MW hyperscale campus in Dublin, said the company.
Additionally, Echelon has a land bank in excess of 500 MW, with 168 MW in advanced stages of agreement with occupiers and expected to commence construction in H1 2024.
Starwood Capital's Data Center Strategy
Over the past five years, Starwood Capital has reportedly invested in the global data center business, committing approximately USD 8 billion of capital across 1.5 gigawatts (GW) of capacity in various stages of development in the United States and Europe. Starwood Capital recently launched Starwood Digital Ventures to oversee its data center investment strategy and activities globally.
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"Data centres have been a core thematic for us in the United States and Europe over the last five years and we are delighted to grow our portfolio in a key sector with strong tailwinds. This transaction materially enhances our data centre footprint and capabilities in Europe," Starwood Capital said.
"We are confident that with the Echelon team and Starwood Digital Ventures, we will continue to find further opportunities to deploy capital into transactions with attractive risk-adjusted returns for our investors, both in Europe and the United States, where we have an additional 600MW of projects in our pipeline, bringing our total global platform to around 1.5GW."
