Wall Street's AI bet: Own the infrastructure, collect the rent
OWL•Alternative asset managers are investing in data centers and emphasizing long-term leases with investment-grade tenants as AI infrastructure spending grows. Blue Owl has more than 130 data centers operating or under construction, while Ares estimates AI-related capital expenditure demand at just over $5 trillion through 2030.
1. Long-term data center leases
Alternative asset managers are betting on AI infrastructure by owning data centers and leasing them to tenants for long terms. Blue Owl Co-CEO Marc Lipschultz said its leases typically run 15 to 20 years, with annual rent increases. Blue Owl has more than 130 data centers operating or under construction, representing nearly 14 gigawatts of leased and owned capacity, with another 21 gigawatts in its pipeline.
2. Investment-grade tenants
Ares Management said it pre-leases data center projects in metropolitan areas including Tokyo, Osaka, London and Sao Paulo to investment-grade hyperscalers, generally under 12- to 15-year leases with no termination rights and inflation escalators. Blackstone said 96% of counterparties in its data center portfolio are investment grade, and most leases initially run 15 to 20 years.
3. Spending and financing risks
Ares estimates AI-related capital expenditure demand at just over $5 trillion through 2030, including roughly $2 trillion for data center buildings and adjacent power infrastructure. Moody's said AI and digital infrastructure are creating large, long-duration financing needs, while warning of growing concentration, construction, residual-value and circular-financing risks.
