Approximately $850 Million
Investment to Provide the Company with Significant Capital to Aid
in its Continued Expansion
MIAMI, Feb. 15, 2024 /PRNewswire/ -- Starwood Capital
Group ("Starwood Capital" or "the Firm"), a leading global private
investment firm focused on real estate, today announced that a
controlled affiliate had made a strategic investment in Echelon
Data Centres ("Echelon" or "the Company").
Echelon was founded in 2016 and has grown to become one of the
leading data centre developers in Ireland and the United Kingdom, providing large-scale
facilities to support the growing global demand for data and
computing resources – sustainably, responsibly and with due regard
for the environment. Echelon currently has 140MW of capacity that
is either operational or in late-stage construction, including a
fully pre-committed 91.4MW hyperscale campus in Dublin. In addition, the company has a
strategic landbank in excess of 500MW, of which 168MW is in
advanced stages of agreement with occupiers and expected to
commence construction in H1 2024.
The transaction will see Starwood Capital commit approximately
$850 million through Starwood
Opportunity Fund XII and Starwood Real Estate Income Trust, Inc,
becoming a 50% shareholder in Echelon and providing material
capital for its continued growth. The investment values the Company
at approximately €2.5bn Enterprise Value. The Company's
capitalisation is further primed for growth through a new €900m
debt facility provided by Morgan Stanley and United Overseas Bank
("UOB").
Over the past five years, Starwood Capital has built a
significant global data centre business committing approximately
$8 billion of capital across 1.5
gigawatts of capacity in various stages of development, making it
one of the largest privately held data centre developers in
the United States and Europe. The firm recently launched Starwood
Digital Ventures to oversee its data centre investment strategy and
activities globally.
Lorcain Egan, Co-Head, Europe, Starwood Capital
Group, commented: "Starwood Capital is delighted to
announce this investment in Echelon. It is a testament to the
business the Echelon team has built since 2016 to establish a
leading European data centre platform. Echelon has been delivering
critical infrastructure to support the growth of some of the
world's most dynamic technology companies and we look forward to
continuing to partner with them in that mission. For Starwood
Capital, this significant and strategic investment continues our
long-term focus and capital deployment into a core sector for our
European business."
David Smith, Managing Director
and Head of Data Centres, Europe
at Starwood Capital, added: "We are incredibly excited to
continue our long-standing relationship with the Echelon team and
to support the accelerated growth of its business. This investment
builds on our expertise and track record in the sector, including
our recent launch of Starwood Digital Ventures, a platform
dedicated to our growing global data centre investment
strategy."
"Data centres have been a core thematic for us in the United States and Europe over the last five years and we are
delighted to grow our portfolio in a key sector with strong
tailwinds. This transaction materially enhances our data centre
footprint and capabilities in Europe. We are confident that with the Echelon
team and Starwood Digital Ventures we will continue to find further
opportunities to deploy capital into transactions with attractive
risk adjusted returns for our investors, both in Europe and the
United States, where we have an additional 600MW of projects
in our pipeline, bringing our total global platform to ~1.5GW,"
said Barry Sternlicht,
Chairman and CEO of Starwood Capital.
Niall Molloy, CEO & and
Founder of Echelon Data Centres, said: "We are very pleased to
enter into this transaction with our long-standing partner,
Starwood Capital. Starwood Capital's scale, access to capital and
track record position Echelon incredibly well to service our
customers' growth requirements on a global basis. We look forward
to the continued growth of the business and expansion into new
European markets and beyond."
Trevor Whelan, CIO of Echelon
Data Centres, said: "Today's announcement is a huge milestone
for the Echelon team on the journey to establishing a global data
centre platform centred around large-scale campuses, and vertical
integration with power generation. It is also a milestone day for
Starwood Digital Ventures, and we are excited to be one of the
foundation blocks as they rapidly grow their Digital Infrastructure
business."
Deutsche Bank acted as lead financial advisor and Morgan Stanley
acted as financial advisor for Starwood Capital, while Kirkland
& Ellis and Arthur Cox acted as
legal counsel.
Eastdil Secured acted as lead financial advisor and Nomura acted
as financial advisor for Echelon Data Centres, and William Fry acted as legal counsel.
Morgan Stanley and UOB acted as Mandated Lead Arrangers on the
financing. Allen & Overy, Arthur
Cox and A&L Goodbody acted for Echelon Data Centres on
the financing and due diligence.
About Starwood Capital Group
Starwood Capital Group is a private investment firm with a core
focus on global real estate. The Firm and its affiliates maintain
16 offices in seven countries around the world, and currently have
5,000+ employees. Since its inception in 1991, Starwood Capital
Group has raised over $75 billion of
capital, and currently has ~$115
billion of assets under management. Through a series of
comingled opportunity funds and Starwood Real Estate Income Trust,
Inc. (SREIT), a non-listed REIT, the Firm has invested in virtually
every category of real estate on a global basis, opportunistically
shifting asset classes, geographies and positions in the capital
stack as it perceives risk/reward dynamics to be evolving. Starwood
Capital also manages Starwood Property Trust (NYSE: STWD), the
largest commercial mortgage real estate investment trust in
the United States, which has
successfully deployed over $95
billion of capital since inception and manages a portfolio
of over $27 billion across debt and
equity investments. Over the past 32 years, Starwood Capital Group
and its affiliates have successfully executed an investment
strategy that involves building enterprises in both the private and
public markets. Additional information can be found at
www.starwoodcapital.com.
About Echelon Data Centres
Echelon Data Centres is an international data centre
infrastructure developer providing large-scale assets to support
the growing global demand for data and computing resource -
sustainably, responsibly and with due regard for the environment.
The company currently has four Irish sites under development, with
a combined potential capacity of more than 500MW (DUB10 –
Clondalkin; DUB40 – Grange Castle; DUB20 and DUB30 - Arklow,
Co Wicklow). Echelon's portfolio
also includes a fully-let and operational 20MW data centre facility
(LCY10) in London's Docklands
(UK), and are under construction at LCY20, a 30MW data centre in
Chesham, Buckinghamshire (UK).
Media Contacts
For Starwood Capital Group
Tom Johnson or Emma Prenn-Vasilakis, H/Advisors Abernathy
tom.johnson@h-advisors.global or
emma.prenn-vasilakis@h-advisors.global
For Echelon Data Centres:
- Craig McKechnie | 4TC | +353
(0)87 621 8839 | craig@4tc.ie
- Jeremy Probert | 4TC | +353
(0)89 700 0792 | jeremy@4tc.ie
Echelon Image Resources are available here:
https://echelon-dc.com/media-resources/
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