Digital Realty acquires Interest in 3 Data Centers (of Blackstone)
for $3.5bn

Digital Realty's acquisition of Blackstone's interest in three fully leased hyperscale data centers in Northern Virginia strategically strengthens Digital Realty's position as a leading provider of cloud- and carrier-neutral data center solutions. This transaction allows Digital Realty to increase its ownership stake in critical assets, enhancing its portfolio with 288 megawatts of IT capacity across two Manassas and one Sterling, VA data centers. The deal includes an 80% interest in the Manassas facilities and a 50% interest in the Sterling facility, valued at $3.5 billion, comprising both cash and Digital Realty shares. From a transactional perspective, the deal structure is straightforward with a gross value of $7.8 billion for Blackstone's equity stake, reflecting an expected initial stabilized capitalization rate over 6.5%. The consideration includes $1.2 billion in cash and $2.3 billion in Digital Realty stock based on the company’s stock price as of June 29, 2026. This move solidifies Digital Realty’s competitive edge by leveraging fully leased assets with long-term, investment-grade leases, which are expected to enhance revenue visibility and growth through accretive rent escalators. The acquisition significantly reshapes the competitive landscape in Northern Virginia's data center market, one of the most sought-after regions globally for hyperscale customers. By consolidating ownership, Digital Realty secures a dominant presence that could deter competitors from entering or expanding in this lucrative market segment. The long-term leases with major hyperscale tenants and robust growth prospects position Digital Realty to capitalize on increasing demand for digital infrastructure. Looking ahead, key risks include the timely completion of development and stabilization of these assets as scheduled. Successful integration will hinge on maintaining operational excellence while ensuring that new capacity comes online without disruption to existing clients. Additionally, ongoing macroeconomic conditions could impact lease renewals and tenant credit profiles. However, with a solid track record of strategic transactions, Digital Realty is well-positioned to extend its growth trajectory and leverage the strong demand for digital infrastructure in one of the world’s most critical data center markets.