DoubleLine Briefing: Investing in Data Center Asset-Backed Securities
DoubleLine's ABS team has published a research paper highlighting investment opportunities in data center Asset-Backed Securities (ABS). The analysis reveals high-yielding prospects with modest risk in this sector, which supports critical technologies from AI to social media. The data center ABS market is experiencing significant growth, with expected issuance of $8 billion in 2024 and potential market size of $50 billion by 2027, up from $25 billion in 2024. The research suggests that subordinate and mezzanine tranches currently offer the most attractive risk-adjusted returns, benefiting from industry dynamics and a stable client base.
Il team ABS di DoubleLine ha pubblicato un documento di ricerca che evidenzia le opportunità di investimento nelle securitizzazioni garantite da attivi di data center (ABS). L'analisi rivela prospettive ad alto rendimento con un rischio modesto in questo settore, che supporta tecnologie critiche dall'IA ai social media. Il mercato delle ABS per i data center sta vivendo una crescita significativa, con un'emissione prevista di 8 miliardi di dollari nel 2024 e una dimensione potenziale del mercato di 50 miliardi di dollari entro il 2027, rispetto ai 25 miliardi di dollari nel 2024. La ricerca suggerisce che i tratti subordinati e mezzanini offrono attualmente i rendimenti corretti per il rischio più interessanti, beneficiando delle dinamiche del settore e di una clientela stabile.
El equipo ABS de DoubleLine ha publicado un documento de investigación que destaca las oportunidades de inversión en valores respaldados por activos de centros de datos (ABS). El análisis revela perspectivas de alto rendimiento con un riesgo moderado en este sector, que apoya tecnologías críticas desde la IA hasta las redes sociales. El mercado de ABS de centros de datos está experimentando un crecimiento significativo, con una emisión esperada de 8 mil millones de dólares en 2024 y un potencial tamaño de mercado de 50 mil millones de dólares para 2027, en comparación con los 25 mil millones de dólares en 2024. La investigación sugiere que los tramos subordinados y mezzaninos ofrecen actualmente los rendimientos ajustados al riesgo más atractivos, beneficiándose de las dinámicas del sector y de una base de clientes estable.
더블라인의 ABS 팀이 데이터 센터 자산 담보 증권 (ABS)에 대한 투자 기회를 강조하는 연구 논문을 발표했습니다. 분석 결과, AI에서 소셜 미디어에 이르기까지 중요한 기술을 지원하는 이 분야에서 적당한 위험으로 높은 수익 가능성이 드러났습니다. 데이터 센터 ABS 시장은 2024년에 80억 달러의 발행이 예상되는 등 상당한 성장을 경험하고 있으며, 2027년까지 잠재적 시장 규모는 500억 달러에 이를 것으로 보입니다. 연구에 따르면 현재 후순위 및 메자닌 트랜치는 산업 역학과 안정적인 고객 기반의 혜택을 받아 가장 매력적인 위험 조정 수익률을 제공합니다.
L'équipe ABS de DoubleLine a publié un document de recherche mettant en évidence les opportunités d'investissement dans les titres adossés à des actifs de centres de données (ABS). L'analyse révèle des perspectives de rendement élevé avec un risque modeste dans ce secteur, qui soutient des technologies critiques allant de l'IA aux réseaux sociaux. Le marché des ABS de centres de données connaît une croissance significative, avec une émission prévue de 8 milliards de dollars en 2024 et une taille de marché potentielle de 50 milliards de dollars d'ici 2027, contre 25 milliards de dollars en 2024. La recherche suggère que les tranches subordinées et mezzanines offrent actuellement les rendements ajustés au risque les plus attrayants, tirant parti des dynamiques industrielles et d'une base de clients stable.
Das ABS-Team von DoubleLine hat ein Forschungsdokument veröffentlicht, das Investitionsmöglichkeiten in von Datenzentren unterstützte Asset-Backed Securities (ABS) hervorhebt. Die Analyse zeigt vielversprechende Aussichten mit moderatem Risiko in diesem Sektor, der kritische Technologien von KI bis zu sozialen Medien unterstützt. Der Markt für Data Center ABS verzeichnet ein erhebliches Wachstum, mit einer erwarteten Emission von 8 Milliarden Dollar im Jahr 2024 und einer potenziellen Markgröße von 50 Milliarden Dollar bis 2027, im Vergleich zu 25 Milliarden Dollar im Jahr 2024. Die Forschung legt nahe, dass nachrangige und mezzanine Tranchen derzeit die attraktivsten risikoadjustierten Renditen bieten, die von den Branchen Dynamiken und einer stabilen Kundenbasis profitieren.
- Market expected to double from $25B to $50B by 2027
- Record issuance of $8B expected in 2024
- Subordinate tranches show strong resilience to stress cases
- Stable revenue stream due to sticky client base
- None.
Insights
Data center ABS represents a significant emerging investment opportunity in the structured finance market. The projected
The subordinate and mezzanine tranches currently offer compelling risk-adjusted returns, benefiting from the defensive nature of data center operations. These assets are particularly attractive due to their high-quality tenant base, typically consisting of large technology companies with strong credit profiles and long-term lease commitments.
For DSL, a closed-end fund focused on income generation, this expanding market provides new opportunities to diversify its portfolio and potentially enhance yields while maintaining relatively modest risk exposure. The sticky client base and mission-critical nature of data centers provide strong fundamental support for these securities.
The paper, "Securitizing the Digital Present & Future: Investing in Data Center Asset-Backed Securities (ABS)," can be accessed here: https://doubleline.com/wp-content/uploads/Securitizing-the-Digital-Present-and-Future_October-2024.pdf
Data centers provide critical infrastructure, Messrs. Diaz and Gioia write, "to support the technologies that are now critical to people's everyday lives." These include emerging technologies such as machine learning, virtual reality, augmented reality and artificial intelligence as well as established ones, for example, email, messenger, streaming and social media.
Securitization, the authors note, is a rapidly growing avenue for the financing of data center assets. Primary-market issuance is "on track to hit record issuance in 2024, with more than
DoubleLine, they write, is finding compelling opportunities in data center ABS throughout the capital structure. Subordinate and mezzanine tranches at present "offer the most attractive risk-adjusted return profiles. Like the senior tranches, the subordinate tranches are generally resilient to stress cases and benefit from the same industry dynamics and sticky client base and have more attractive spread and yield."
About the DoubleLine Asset-Backed Investment Team
The Asset-Backed Securities Investment team manages
About DoubleLine
DoubleLine Capital LP is an investment adviser registered under the Investment Advisers Act of 1940. DoubleLine's offices can be reached by telephone at (813) 791-7333 or by email at info@doubleline.com. Media can reach DoubleLine by email at media@doubleline.com. DoubleLine® is a registered trademark of DoubleLine Capital LP.
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SOURCE DoubleLine
FAQ
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