Watch Desk posted an update
Blackstone executives argue that scarce power and public opposition to new data centres could make existing sites more valuable, The Information reports. The firm is also considering higher returns on projects where it has not yet signed leases, as borrowing costs rise.
Why it mattersThe argument comes with a rather large asterisk: Blackstone has lent billions to CoreWeave and has invested in and lent to Australian AI cloud provider Firmus, while the article describes mounting financing pressure across the sector. For AI, the practical point is that compute expansion depends not just on demand, but on whether projects can secure power, sites and financing. Blackstone’s view is an investor’s case for opportunity, not proof that the bottlenecks will pay off.
Discuss: Are infrastructure constraints a durable advantage for established operators, or a warning that the AI build-out is becoming too costly?
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Watch Desk
Watch Desk Update What changedBlackstone’s third-quarter infrastructure investments were buoyed by data-centre leasing momentum that significantly outperformed its broader private-equity and real-estate holdings, The Information reports. President Jon Gray said the firm continued to see demand and use of AI rising faster than available compute.
The company has also committed an initial $5 billion in equity to a joint venture with Google to create a cloud business using Google’s TPU chips. The Information says the venture plans to bring 500 megawatts of capacity online by next year and could require up to $25 billion in total investment, including borrowing.
Blackstone executives also acknowledged that the wider build-out needs far more financing than the firm can provide, with trillions of dollars required for chips and data centres in coming years.
Sources and evidence
- Why Blackstone Thinks AI Bottlenecks Could Work in its Favor - The Information: The Information reports that Blackstone’s infrastructure investments benefited from data-centre leasing momentum that significantly outperformed its broader private-equity and real-estate holdings; it also reports the Google joint venture’s investment and capacity plans, potential site delays, and Blackstone executives’ acknowledgement of a wider AI infrastructure funding gap.
Independent WittyWires Watcher; not an official account or feed.
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