REIT CyrusOne targets Southeast US in $490m data center shopping spree
Operator buys two data centres which at maximum capacity will top 390,000 sqf of colocation space.
Dallas data centre REIT CyrusOne has spent nearly half a million dollars to expand its footprint in New Jersey and enter the North Carolina market for the first time.
The company has invested $490m in the acquisition of two ready-to-use data centres located in Raleigh-Durham, NC, and Somerset, NJ, from Sentinel Data Centers.
The two properties consiste of more than 160,000 colocation sqf and approximately 21 MW of power capacity, with nearly 85% of the power capacity leased.
The builds sit on a combined piece-of-land measuring 51.5 acres and the facilities offer all-in-all 850,000 sqf of space.
The Raleigh-Durham Data Center corresponds to 10MW of the power, and has a total expansion capacity of 23 MW.
Together, the two facilities have a maximum expansion capacity of 230,000 colocation sqf.
CyrusOne highlights that both data centres have 8MW and 34,000 sqf of colocation space either available for lease or ready for development with a total cost of $15m.
In Somerset, the data centre accounts to 11MW with total expansion possible up to 22MW.
In 2016, the two facilities generated a revenue of nearly $50m, according to results fillings. Over 80% of rent from the facilities was generated from customers in the Healthcare and Financial Services verticals.
With the acquisition, CyrusOne will be adding 30 Sentinel customers to its list of clients. Over two-thirds of customers are new to the operators, including five Fortune 1,000 companies.
CyrusOne said it intends to finance the acquisition with proceeds from its equity sale completed in August 2016 and its recently expanded credit facility.
The transaction is expected to close in in March 2017, subject to the fulfilment of customary closing conditions.
Gary Wojtaszek, president and CEO of CyrusOne, said: “We are very excited about this transaction, which establishes a presence for us in the Southeast, adds a high quality portfolio of large enterprise customers, and features an attractive long-term lease profile.
“The transaction is expected to be immediately accretive and provides significant opportunities to grow the combined business and create value for our shareholders.”
Josh Rabina, Sentinel’s co-founder and co-CEO, said: “We have known the CyrusOne team for almost ten years and have a great deal of respect for their organisation.
“They have earned an excellent reputation in the industry for customer service and quality, so we know our customers are in good hands.”
DLA Piper served as primary external legal counsel for CyrusOne. For Sentinel, DH Capital served as its exclusive financial advisor and Skadden, Arps, Slate, Meagher & Flom, LLP as legal counsel.