Equinix seals $800m Infomart deal with an eye on Latin America
The Infomart is one of the largest interconnection hubs in the U.S. and is currently home to four of eight Equinix Dallas International Business Exchange data centres (DA1, DA2, DA3 and DA6).
Equinix (NASDAQ: EQIX) has completed the $800m acquisition of Infomart Dallas from ASB Real Estate Investments, in a move the company says will “enable further expansion” in the region.
The debt and cash transaction provides approximately 1.6 million gross sqf of space, which includes multiple diverse fiber entry points and more than 50 tenants including networks, colocation providers and office tenants.
The acquired portfolio also secures the ability for further expansion in the Dallas market through build-out of the existing underdeveloped capacity and additional capacity to build on land adjacent to the Infomart building.
The agreement was originally signed on February 11, 2018 and the acquisition was completed on April 2, 2018.
The Infomart building generated approximately $50m million of revenues in 2017. Of that revenue, approximately $20m was attributed to rent and maintenance recoveries from Equinix.
Equinix expects this transaction to be adjusted funds from operations (AFFO) per share breakeven one year from closing. Additionally, there is a sizable AFFO upside from the future development of the acquired land parcel that is adjacent to the Infomart Dallas building.
Latin America in mind
Although based in one of the US’s most data centre active hotspots, Infomart Dallas will be used by Equinix to further strengthen its network of data centres across Latin America.
Bill Long, Vice President of Interconnection Product Management at Equinix, said: “Dallas is historically a major gateway to Latin America, serving Mexico as well as Central and South America.
“The Infomart acquisition combines with our existing operations in Bogotá, Los Angeles, Miami, Rio de Janeiro and São Paulo to give us a more robust Latin American footprint of network and content providers looking to grow in the region.
“It bolsters business opportunities for managed services and cloud services providers, which have high usage rates by Latin American enterprises. And it increases access to important Latin American financial ecosystems, including those built around the Brazilian and Mexican stock exchanges.”
According to the 2017 Interconnection Index Report published by Equinix, LATAM is expected to be the fastest-growing region in terms of Interconnection Bandwidth through 2020 as customers embrace an Interconnection Oriented Architecture approach.