REDWOOD CITY, Calif.,
Oct. 18, 2021 /PRNewswire/ --
Equinix, Inc. (Nasdaq: EQIX), the world's digital
infrastructure company™, and PGIM Real Estate, the real estate
investment and financing arm of Prudential Financial's global asset
management business, today announced an agreement to establish a
US$575 million joint venture in the
form of a limited liability partnership to develop and operate
two xScale data centers in Sydney,
Australia.
The facilities in the joint venture, which will be known as SY9x
and SY10x, are expected to provide more than 55 megawatts (MW) of
power capacity to serve the unique core workload deployment needs
of a targeted group of hyperscale companies, including the world's
largest cloud service providers. The first xScale data center in
Sydney – SY9x is
expected to open in Q1 2022.
Combined with Equinix's existing hyperscale joint ventures in
Europe, Asia-Pacific and the Americas, this joint
venture will bring the global xScale data center portfolio to
more than $7.5 billion across 34
facilities, and an expected greater than 675 MW of power capacity
when completed and fully constructed.
To date, six xScale data centers have been opened in
Asia-Pacific, EMEA and LATAM,
including TY12x in Tokyo, PA8x and
PA9x in Paris, LD11x and LD13x in
London, and SP5x in São Paulo,
with more currently under development.
Highlights/Key Facts:
- Equinix is the leading data center provider in Australia with 17 International Business
Exchange™ (IBX®) data centers, which will increase to 18
when PE3 in Perth opens later this
year.
- Under the terms of the agreement, PGIM Real Estate will control
an 80% equity interest in the joint venture, and Equinix will own
the remaining 20% equity interest. The joint venture is expected to
close in Q4 2021, pending regulatory approval and other closing
conditions.
- As one of the largest real estate managers in the world, PGIM
Real Estate will contribute market insight and support to the joint
venture with its deep knowledge of local real estate equity and
debt markets applied through its 1,100+ experienced professionals
across 31 offices worldwide. By deploying research-led initiatives
such as this new program with Equinix, PGIM Real Estate strives to
deliver exceptional performance for both its partners and
investors.
- Structure Research forecasts that hyperscale colocation market
in Sydney and Melbourne, in terms of built-out critical MW
capacity, will grow at a compound annual growth rate (CAGR) of 22%
from 2021 to 2026.1 With xScale data centers in
Australia, hyperscale companies
can add core deployments to their existing access-point footprints
at Equinix, enabling their growth on a single platform that can
immediately span 65 global metros and offer direct
interconnection—within robust ecosystems—to their customers and
strategic business partners.
- Currently, Platform Equinix® features more than 40%
of the private on-ramps to the top global cloud service
providers—more than any other provider. For years, the world's
largest cloud service providers, including Alibaba Cloud, Amazon Web Services, Google
Cloud, IBM Cloud, Microsoft Azure and Oracle Cloud Infrastructure,
have partnered with Equinix to leverage its global platform of more
than 230 data centers to directly connect to their strategic
business partners and customers. With the xScale program, these
hyperscalers can continue to grow at Equinix, in close proximity to
an ecosystem of 10,000 customers.
- According to an independent Global Tech Trends report released
by Equinix in May this year, which surveyed 2,600 IT
decision-makers across 26 countries, hybrid and multicloud
deployments in Australia were
trending up from 28% to 47% year-on-year.2 The
xScale program in Australia will
enable enterprises to directly connect and operate in proximity to
the largest global cloud operators to build and grow their hybrid
multicloud infrastructure.
- Equinix is a leader in data center sustainability and is
greening the supply chains of its customers. Equinix is the first
data center operator to commit to reaching climate-neutral by 2030
globally, backed by science-based targets and a sustainability
innovation agenda. The company's long-term goal of using 100% clean
and renewable energy for its global platform has resulted in
significant increases in renewable energy coverage globally. Most
recently, Equinix, together with HSBC Bank, Nike Australia, Goldman
Sachs and Hennes & Mauritz (H&M), also received
determination from the Australian Competition and Consumer
Commission (ACCC) for joint renewable energy purchasing in
Australia. Equinix has continued
to make advancements in the way it designs, builds and operates its
data centers with high energy-efficiency standards, and all xScale
data centers are expected to be LEED certified (or the equivalent
regional certification).
- Citi served as exclusive financial advisor to Equinix in
connection with this transaction.
Quotes:
- Jabez Tan, Head of Research,
Structure Research:
"Australia is set to build out its next wave of
capacity, with the hyperscale market expected to grow about double
the rate of the retail segment by 2026. There have been
unprecedented levels of cloud adoption in the country. Equinix's
expansion into Australia's
hyperscale market is a timely move to address the aggressive demand
among hyperscalers in Australia
and will further accelerate digital transformation in the
country."
- Eric Adler, Chief Executive Officer, PGIM Real
Estate:
"We are extremely pleased to partner with Equinix
on this investment in Sydney, and
we look forward to expanding this strategic relationship in other
markets, thereby providing our investors further access to
the increasingly important digital infrastructure
sector. This is a highly symbiotic venture between two
market-leading firms with complementary business models and global
capabilities."
- Charles Meyers, President and
CEO, Equinix:
"As digital transformation accelerates
across all industries, hybrid multicloud is becoming the IT
architecture of choice for leading businesses. These companies
recognize that digital infrastructure is a source of competitive
advantage, and they are leveraging Platform Equinix to directly
connect and operate close to the largest cloud companies powering
this infrastructure. Our new relationship with PGIM Real Estate
follows our successful partnership with GIC and will enable
the world's largest hyperscalers to expand within the Equinix
ecosystem in Australia."
Additional Resources
- Hyperscale Data Center Expansion Goes into
Hyperdrive [Equinix Blog]
- Equinix and GIC to Add $3.9B to
Expand xScale Data Center Program [press release]
- Hyperscale Connectivity Drives $3
Billion in Data Center Projects by Equinix and JV
Partners [press release]
- Equinix and GIC to Form Greater than US$1.0 Billion Joint Venture to Develop and
Operate Hyperscale Data Centers in Japan [press release]
- Equinix and GIC Complete Formation of Greater than US$1.0 Billion European Data Center Joint
Venture [press release]
- How Hyperscale Data Centers Can Power Cloud Provider
Success [Equinix Blog]
- Learn more about Platform Equinix [website]
About Equinix
Equinix, Inc. (Nasdaq: EQIX) is the
world's digital infrastructure company, enabling digital leaders to
harness a trusted platform to bring together and interconnect the
foundational infrastructure that powers their success. Equinix
enables today's businesses to access all the right places, partners
and possibilities they need to accelerate advantage. With Equinix,
they can scale with agility, speed the launch of digital services,
deliver world-class experiences and multiply their value.
About PGIM Real Estate
As one of the largest real
estate managers in the world with US$195
billion in gross assets under management and
administration,3 PGIM Real Estate strives to
deliver exceptional outcomes for investors and borrowers through a
range of real estate equity and debt solutions across the
risk-return spectrum. PGIM Real Estate is a business of PGIM, the
US$1.5 trillion global asset
management business of Prudential Financial, Inc. (NYSE: PRU).
PGIM Real Estate's rigorous risk management, seamless execution,
and extensive industry insights are backed by a 50-year legacy of
investing in commercial real estate, a 140-year history of real
estate financing, and the deep local expertise of professionals in
32 cities globally. Through its investment,
financing,4 asset management, and talent management
approach, PGIM Real Estate engages in practices that ignite
positive environmental and social impact, while pursuing activities
that strengthen communities around the world. For more information
visit pgimrealestate.com.
Forward-Looking Statements
This press release contains
forward-looking statements that involve risks and uncertainties.
Actual results may differ materially from expectations discussed in
such forward-looking statements. Factors that might cause such
differences include, but are not limited to, risks related to
Equinix's ability to complete the closing of the joint ventures on
the proposed terms and schedule; risks related to Equinix or PGIM
Real Estate being able to satisfy their respective closing
conditions related to the joint ventures, including obtaining
regulatory approval; any inability of Equinix, PGIM Real Estate or
the joint ventures to obtain financing as needed; risks related to
whether the data centers which will be developed and contributed to
the joint ventures will be integrated successfully, and whether
such development and integration may be more difficult,
time-consuming or costly than expected; risks that the expected
benefits of the joint ventures will not occur; the challenges of
operating and managing data centers and developing, deploying and
delivering Equinix services; the ability to generate sufficient
cash flow or otherwise obtain funds to repay new or outstanding
indebtedness; competition from existing and new competitors; the
loss or decline in business from key hyperscale companies;
disruption from the joint ventures making it more difficult to
conduct business as usual or maintain relationships with customers,
employees or suppliers; and other risks described from time to time
in Equinix's filings with the Securities and Exchange Commission.
In particular, see recent Equinix quarterly and annual reports
filed with the Securities and Exchange Commission, copies of which
are available upon request from Equinix. Equinix does not assume
any obligation to update the forward-looking information contained
in this press release.
1 Australia
(Sydney & Melbourne) DCI Report 2021: Data Centre
Colocation, Hyperscale Cloud & Interconnection
2 Equinix Global Tech Trends Survey 2021
3 As of June 30, 2021. AUM
reflected as gross. Net AUM is $130B
and AUA is $43B.
4 Includes legacy lending through PGIM's parent company,
Prudential Financial, Inc.
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SOURCE Equinix, Inc.