June 29 (Reuters) – Digital Realty will acquire a larger stake in three data centers in Northern Virginia from asset manager Blackstone in a $3.5 billion cash-and-stock deal, the companies said on Monday.
Under the deal, which is expected to close on Tuesday, the data center company will pay $1.2 billion of cash and $2.3 billion in Digital Realty shares to Blackstone’s funds.
The move strengthens the data center operator’s position in Northern Virginia, the world’s largest data center market, where demand for capacity has surged as cloud computing and AI drive higher infrastructure needs.
The companies said Digital Realty will acquire Blackstone’s 80% interest in two 96-megawatt data centers in Manassas, Virginia, and a 50% interest in a 96-megawatt center in Sterling, Virginia.
Shares of Digital Realty were down about 2.4% in extended trading.
The assets of the three data centers are valued at $7.8 billion, including debt and planned capital expenditures, according to the companies.
“This transaction is expected to be accretive to Core FFO per share in each of 2027 and 2028, as development is completed and rents commence,” said Digital Realty CFO Matt Mercier.
The companies said two of the facilities are expected to stabilize in the first half of 2027, with the third expected to stabilize in the first half of 2028.
Blackstone is one of the largest financial investors in data center and digital infrastructure assets, having invested about $200 billion in transactions across capital structures since 2018, including over $130 billion in data center assets.
The asset manager also launched an investment vehicle, Blackstone Digital Infrastructure Trust, which raised $1.75 billion in its IPO to acquire newly built data centers.
(Reporting by Jaspreet Singh in Bengaluru; Editing by Vijay Kishore and Maju Samuel)
