Cool Vector Media

Cheap natural gas is among the reasons a largely unpopulated region spanning Texas and New Mexico is ideal for "large, contiguous campuses" of data centers, says the founder of LandBridge, a publicly traded firm that owns 270,000 surface acres in the Delaware Basin. David Capobianco, Chairman of LandBridge as well as CEO of investment firm Five Point Energy, says in an interview with Cool Vector that the Delaware has "all the elements necessary" for data center development, including a sparse population, friendly Texas regulatory regime, plentiful water from frack wells, and briney aquifers that can "deliver a million barrels a day." The Delaware, a sub-basin of the Permian, also has abundant natural gas. "We have the lowest-cost gas in North American," says Capobianco. "It gives you a phenomenally low-priced, gas-fired power solution." Capobianco notes LandBridge also operates a carbon sequestration business in the area. The Permian Basin is a major oil-and-gas geographic region that produces some 46% of crude oil in the US and about 25% of the country's natural gas. View the full interview with David Capobianco on Cool Vector's YouTube channel: https://lnkd.in/epz3Usty Visit the Cool Vector website: https://lnkd.in/dnBgwHXc #digitalinfrastructure #datacenters #land #delawarebasin #development

Data centers around the world backed by Actis must adhere to the standards of reduced carbon, resource efficiency and resilience, says James Magor, Director, Sustainability, of the global infrastructure investment firm Actis. In a recent interview with Cool Vector, Magor uses the example of portfolio company Epoch Digital, a platform for data center development across Asia, to illustrate the firm's standards. Epoch data centers must use as much renewable energy as possible in their markets of operation, and be built and operated at the "top-tier" of power-usage effectiveness (PUE) and water efficiency. In addition, Epoch data centers must be built to withstand any number of natural disasters. Magor notes a typhoon that struck Taiwan during construction tested the resilience of the data center design. Magor was jointly interviewed with Actis Partner Thomas Liu about the firm's sustainable approach to investing in digital infrastructure. Watch the full interview on Cool Vector's YouTube channel: https://lnkd.in/eUKGt_FY Access full Cool Vector episodes on Spotify: https://lnkd.in/ewjzmktM Visit the Cool Vector website: https://lnkd.in/eabff4eT #datacenters #greenenergy #digitalinfrastructure #building #sustainableinfrastructure

NEW Cool Vector episode: "West Texas Land is Perfect for Data Centers, says LandBridge Founder." David Capobianco's company, LandBridge, owns 270,000 surface acres in West Texas, and he's pleased to explain why the land's profitability has tripled in three years. The reason has to do with data centers. Watch the full interview on Cool Vector's YouTube channel: https://lnkd.in/dNKwW4hM Or listen to it on Spotify: https://lnkd.in/dUqxKmup LandBridge is a publicly traded affiliate of Five Point Energy, of which Capobianco is CEO. The company's share price is being carefully watched by investors looking for evidence of a new paradigm in land ownership. Acreage once used primarily for ranching or energy extraction in the Permian Basin is now seen as ideal for data centers. In an wide-ranging interview with Cool Vector, Capobianco details the attractive features of his "powered land" in the Delaware sub-basin, spanning West Texas and New Mexico: it sits on top of the lowest-cost natural gas in North America, it has plentiful produced and brackish water for cooling, it is proximate to good fiber connectivity and carbon sequestration resources, and it is governed by an exceptionally friendly Texas regulatory regime. What's more, the Delaware land is far away from any population center, removing community apprehension as a barrier to development. LandBridge's surface acreage is "open for business," says Capobianco, meaning any potential digital infrastructure partner can expect rapid support in the development of data centers, including proprietary water infrastructure developed by LandBridge, which processes some 4 million barrels of water daily across the Permian. Cooling capabilities have become more and more critical as new technology, such as Nvidia's Blackwell chips, runs hotter and hotter. Capobianco describes the opportunity for renewable energy in the Permian as important but not sufficient on its own. Because hperscalers are locked in an "existential" battle for data center development, the more consistent energy provided by bountiful West Texas natural gas is in high demand. He says the only renewable energy capable of fully powering a data center is nuclear. He also details the business plan of LandBridge, which makes money from land leases as well as power margins and some mineral rights. Capobianco predicts well-suited land in the Permian and elsewhere will "re-rate" now that investors recognize a net new source of revenue in the form of digital infrastructure. Says Capobianco: "The need is great, the race is on."

Fierce AI competition among big tech companies is keeping natural gas the primary power source for data centers, says David N. Capobianco, Chairman of LandBridge and CEO of Five Point Energy. While Capobianco predicts renewable sources of energy, such as solar and wind, will become increasingly prominent as power sources for hyperscalers, "Powering their data centers and getting them up and running is of paramount importance, and that's what they're focused on. . . If these guys don't solve their AI data center needs, they have a threat for their survival." The biggest investors in data centers around the world, so-called hyperscalers like Google, Oracle, Microsoft, Meta and xAI, have ambitious renewable energy mandates for their power-hungry data centers. Capobianco notes that while renewable power already is an important contributor to the overall energy mix for data centers, it lacks the consistency of natural gas, and because of this its impact is not yet as pronounced as advocates for green energy would like. In the meantime, says Capobianco, "The need is now, so gas is really the bridge." Capobianco makes his comments in the Cool Vector episode, "West Texas Land is Perfect for Data Centers, Says LandBridge Founder." Watch the full interview on the Cool Vector YouTube channel:  https://lnkd.in/eBAYX7bj and Follow on Spotify: https://lnkd.in/evmcpYKD Visit the Cool Vector website: https://lnkd.in/eabff4eT #datacenters #ai #energy #landuse #renewableenergy #sustainableenergy #microsoft #google #oracle #westtexas

NEW Cool Vector episode: "Actis' Sustainable Strategy in Digital Infrastructure." Private equity firm Actis is building data centers around the world while maintaining strict standards around sustainable energy, water and social impact. And the firm's impact is about to get bigger. Actis and General Atlantic recently merged to create an $87 billion investment platform, with Actis focused on the huge opportunity in sustainable infrastructure, largely in growth markets across Asia, Latin America, Africa and Eastern Europe. Watch the full episode on the Cool Vector YouTube channel: https://lnkd.in/edb6WPHA Digital infrastructure is a significant part of the investment mandate for Actis, with 17 offices across the world. The firm draws on its on-the-ground expertise in real estate, renewable energy and infrastructure to tackle the many burgeoning opportunities in data centers, wireless towers and fiber. In a wide-ranging interview, Thomas Liu and James Magor, Partner and Director, respectively, describe a global build-out of data centers in global growth markets, most of which have not previously offered data center sites to hyperscaler customers. Each market has a very different regulatory regime, but most favor data sovereignty, and are led by governments aware of the developmental benefits that digital infrastructure can bring to their economies. Driving the development are expansion-minded hyperscaler customers like Amazon and Microsoft, which are locked in a competition for AI dominance around the world. Liu notes these hyperscalers need local partners with insights into local regulations, and the ability to maintain relationships of trust with local communities. For example, Actis has taken a successful digital literacy program from its operations in Nigeria and started using it to engage with communities across Asia. Liu and Magor discuss Actis' recent investment in Epoch Digital, a diversified data center platform with developments planned in South Korea, Malaysia and Taiwan. Magor says the importance of resilient building techniques was highlighted by a recent Taiwanese typhoon that hit Epoch's construction site there. Liu explains the benefits of merging with General Atlantic, including an expanded investor base and the ability for Actis to draw on General Atlantic's deep relationships with TMT customers across the world.

The global net-zero goals of hyperscaler customers like Amazon and Microsoft are so aggressive, they view local partners with expertise in sustainable data centers as critical, says Thomas Liu, a Partner at infrastructure investment firm Actis. With a focus on growth markets, Actis, with 17 offices around the world, taps its local expertise in green power and regulations to deliver to hyperscalers what they demand. "There's no one better than Actis to be able to do that, given our credentials in renewable energy sectors," says Liu. Governments in countries like Taiwan, South Korea and Malaysia are eager to grant approvals to projects that will ultimately feed green power into national electricity grids. What's more, Actis is building digital infrastructure with an eye toward eventual exits to buyers who also view sustainability as mission critical, says Liu. Liu and Actis Director James Magor make their comments in the Cool Vector episode, "Actis' Sustainable Strategy in Digital Infrastructure." Watch the full interview on the Cool Vector YouTube channel: https://lnkd.in/ewVSJqyq and Follow Cool Vector on Spotify to stay up to date on new episodes: https://lnkd.in/e9zs9ngX Visit the Cool Vector website: https://lnkd.in/eabff4eT #datacenters #digitalinfrastructure #greenpower #sustainability #hyperscale

As data center REITs, Equinix and Digital Realty Trust both benefit from the surge in demand created by artificial intelligence. But their customer profiles are different, says Harold Chen, Director of Commercial Real Estate at Fitch Ratings. Compared with Equinix, Digital Realty has a higher concentration of hyperscaler customers, says Chen. While hyperscaler companies like Microsoft, Meta and Alphabet have the ability to speak for all the rack space in a data center, having hyperscalers as primary customers does mean higher tenant concentration, an important category of risk. Chen makes their comments in the Cool Vector episode, "Equinix vs. Digital Realty: A Fitch Analyst Talks Data-Center REITs." Watch the full interview on the Cool Vector YouTube channel: https://lnkd.in/e45XRZJj Visit the Cool Vector website: https://lnkd.in/eabff4eT #datacenters #digitalinfrastructure #reits #hyperscale

Compensation in private-market digital infrastructure is "more appealing than the stock plan that might be in place. . . at a big tech or industrial conglomerate," says Patrick Reyes, a Principal at executive search firm ONE SEARCH. Reyes notes the digital infrastructure industry is drawing in professionals who have built careers at data center, telecom, real estate and technology corporations, largely because the compensation offered at private-capital-backed digital infrastructrure platforms makes this a "really attractive move." While many publicly traded companies offer stock incentive plans to senior executives, private market companies can offer more powerful incentive components, including points of carried interest, presented with notional value estimates for how much executives might make in a range of exit scenarios. For infrastructure professionals, private market incentive plans are "more directly linked to their specific work," says Reyes. "You have the value creation opportunity to push the needle on what your incentive is worth, and so you're more in control of your earning potential." Reyes makes his comments in the Cool Vector episode, "Why Comp is Surging for Digital Infrastructure Investors and Operators." Watch the full interview on Cool Vector's YouTube channel: https://lnkd.in/eAfrUiRH Visit the Cool Vector website: https://lnkd.in/dnBgwHXc #privatemarket #digitalinfrastructure #datacenters

Real estate investment trusts comprised of data centers have a much higher level of operational intensity than do traditional REITs, says Harold Chen, Director of Commercial Real Estate at Fitch Ratings. Chen compares an industrial-property REIT to REITs like Equinix and Digital Realty Trust, to make the point that data centers have many more operational "moving parts" related to power delivery, cooling and interconnections. Chen makes their comments in a Cool Vector episode, "Equinix vs. Digital Realty: A Fitch Analyst Talks Data-Center REITs." Watch the full interview on Cool Vector's YouTube channel: https://lnkd.in/eVUN7U2f Visit the Cool Vector website: https://lnkd.in/eabff4eT

NEW Cool Vector episode: "Equinix vs. Digital Realty: A Fitch Analyst Talks Data-Center REITs." Data center real estate investment trusts (REITs), like Equinix and Digital Realty Trust, differ from traditional REITs in their higher operational intensity and reliance on artificial-intelligence tailwinds for growth, says Harold Chen, Director of Commercial Real Estate at Fitch Ratings. Chen, whose team has assigned investment-grade ratings to Equinix and Digital Realty, says the companies benefit from surging demand related to AI. Of the two, Digital Realty has a higher concentration of hyperscaler customers, defined as big-tech, data-center customers like Microsoft, Mega and Amazon. The upside of hyperscaler concentration is longer-term leases, while the downside is customer concentration and the inability to more frequently reprice rent rates, says Chen, adding data center REITs have a history of only single-digit customer churn. Data centers that cater to co-location customers tend to have shorter leases, he says. Data-center REITs also differ from traditional REITs in their "significantly higher levels of operational intensity," says Chen. Complexities like power, cooling and interconnectivity make data-center REITs "significantly different beasts." Chen also discusses with Cool Vector the impact that ESG and sustainability initiatives have on Fitch ratings, and the historic challenge for data center companies to access certain forms of financing, like asset backed securities (ABS). Watch the full episode on Cool Vector's YouTube channel: https://lnkd.in/eVUN7U2f