Newmark Arranges $600 Million Construction Financing for 50 MW Build-to-Suit Data Center for Blue Owl, Chirisa and PowerHouse

Rhea-AI Summary

Newmark Group (NASDAQ: NMRK) has arranged a $600 million construction financing for a 50 megawatt build-to-suit data center development in Northern Virginia. The project is being developed by Blue Owl Real Estate, Chirisa and PowerHouse Data Centers, and will be leased to CoreWeave, a hyperscale graphics processing unit provider.

The development is located within the 300+ acre Chirisa Technology Park in Richmond and is expected to deliver initial capacity in 2025. The facility will feature state-of-the-art fit-outs and access to highly redundant fiber networks to serve customers throughout the east coast. The loan was provided by a syndicate led by Societe Generale.

Positive

• Successfully arranged $600 million in construction financing
• Secured lease with major tenant CoreWeave
• Project located in strategic Northern Virginia market

Negative

• None.

Insights

Financial Analyst

The $600 million construction financing deal marks a significant milestone in the data center sector, particularly given the strategic importance of Northern Virginia's market. The project's lease to CoreWeave, a leading GPU provider, adds substantial value proposition given the surging demand for AI infrastructure. The development's timing aligns perfectly with the market's trajectory, as data center construction pipelines reach record highs in 2024. For Newmark (NMRK), this deal demonstrates their growing capability in arranging large-scale digital infrastructure financing, potentially leading to increased fee revenue and market share in this high-growth sector. The involvement of major players like Blue Owl Real Estate and Societe Generale adds credibility to the project's viability and Newmark's execution capabilities.

Tech Infrastructure Analyst

The 50MW data center project represents a strategic expansion in Northern Virginia's critical digital infrastructure landscape. CoreWeave's commitment as the tenant is particularly noteworthy given their focus on GPU computing, which is essential for AI workloads. The facility's location within Chirisa Technology Park provides significant advantages in terms of power availability and fiber connectivity. The planned 2025 delivery timeline positions this development well to capture the growing demand for AI computing infrastructure. The project's scale and specifications align with the increasing requirements for high-performance computing facilities, particularly in supporting AI applications and hyperscale cloud services. This development will strengthen the region's position as a premier data center market.

NEW YORK, Dec. 13, 2024 /PRNewswire/ -- Newmark Group, Inc. (Nasdaq: NMRK) ("Newmark" or "the Company"), a leading commercial real estate advisor and service provider to large institutional investors, global corporations, and other owners and occupiers, announces the firm has arranged a $600 million loan to capitalize a 50 megawatt build-to-suit data center development by Blue Owl Real Estate, Chirisa and PowerHouse Data Centers in Northern Virginia. The financing was arranged by Newmark's Co-Presidents of Global Debt & Structured Finance Jordan Roeschlaub and Jonathan Firestone, along with Clint Frease, Nick Scribani, Ben Kroll and John Caraviello in collaboration with Brent Mayo, Head of Newmark's Data Center Capital Markets.

"This transaction reflects the continued appetite for innovative, large-scale digital infrastructure solutions in key markets," said Roeschlaub. "This project underscores the critical role of Northern Virginia in supporting the growth of AI and hyperscale cloud applications due to its advanced facilities, robust connectivity and strategic location. It also highlights the resilience of the data center sector as a cornerstone of today's global economy."

Leased to leading hyperscale graphics processing unit provider CoreWeave, the project is located within the 300+ acre Chirisa Technology Park in Richmond, offering supplemental mission critical capacity within one of its most customer-dense regions in the US. In addition to increasing CoreWeave's stronghold in this market, the development will also provide state-of-the-art fit-outs and access to highly redundant fiber networks, allowing it to serve customers throughout the east coast. The development broke ground earlier this year and is expected to deliver initial capacity in 2025.

Newmark Research reported in January that the data center industry is growing rapidly, fueled by expanding needs of hyperscalers, AI and high-performance computing users and large enterprises. The increased demand has spurred a surge in new development and land banking for future development, with data center construction pipelines hitting new all-time highs in 2024.

The loan was provided by a syndicate led by Societe Generale.

About Blue Owl Real Estate
Blue Owl Real Estate is a leading real estate private equity platform with $27bn of AUM. The real estate platform offers flexible and bespoke capital solutions to investment-grade and creditworthy tenants. Blue Owl Real Estate specializes in structured sale-leaseback transactions with long lease terms. With expertise in both direct and indirect real estate investing, a proprietary origination platform, and enhanced lease structures, Blue Owl Real Estate provides flexible real estate solutions to a range of organizations across asset classes and geographies

About Chirisa
Chirisa is a global investor active across Digital Infrastructure and Real Estate in the Americas and Europe. The firm's exceptional track record of value creation is driven by a multidisciplinary approach, combining deep operating expertise with extensive private investment and financing experience. The firm seeks situations where their capital, expertise, and operational support help create substantial and sustainable value. Investing as a principal, they have a flexible and long-term approach to value creation.

About PowerHouse
PowerHouse Data Centers, fully owned and operated by American Real Estate Partners (AREP), is a leading provider of state-of-the-art data center solutions, offering secure and scalable infrastructure tailored to meet the needs of hyperscale end users. From site selection and acquisition through design, build and operations, PowerHouse offers turnkey solutions developed by proven real estate leadership and seasoned in-house construction management and the best technical expertise from their design teams and contractor partners.

About Newmark
Newmark Group, Inc. (Nasdaq: NMRK), together with its subsidiaries ("Newmark"), is a world leader in commercial real estate, seamlessly powering every phase of the property life cycle. Newmark's comprehensive suite of services and products is uniquely tailored to each client, from owners to occupiers, investors to founders, and startups to blue-chip companies. Combining the platform's global reach with market intelligence in both established and emerging property markets, Newmark provides superior service to clients across the industry spectrum. For the twelve months ended September 30, 2024, Newmark generated revenues of approximately $2.6 billion. As of that same date, Newmark's company-owned offices, together with its business partners, operated from nearly 170 offices with more than 7,800 professionals around the world. To learn more, visit nmrk.com or follow @newmark.

Discussion of Forward-Looking Statements about Newmark
Statements in this document regarding Newmark that are not historical facts are "forward-looking statements" that involve risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements. These include statements about the Company's business, results, financial position, liquidity, and outlook, which may constitute forward-looking statements and are subject to the risk that the actual impact may differ, possibly materially, from what is currently expected. Except as required by law, Newmark undertakes no obligation to update any forward-looking statements. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see Newmark's Securities and Exchange Commission filings, including, but not limited to, the risk factors and Special Note on Forward-Looking Information set forth in these filings and any updates to such risk factors and Special Note on Forward-Looking Information contained in subsequent reports on Form 10-K, Form 10-Q or Form 8-K.

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SOURCE Newmark Group, Inc.

FAQ

What is the value of the construction financing arranged by Newmark (NMRK) for the data center project?

Newmark arranged $600 million in construction financing for the data center project in Northern Virginia.

When will the Newmark (NMRK) financed data center project deliver initial capacity?

The data center project is expected to deliver initial capacity in 2025.

Who is the main tenant for the Newmark (NMRK) financed 50MW data center?

CoreWeave, a leading hyperscale graphics processing unit provider, is the main tenant for the data center.

Where is the Newmark (NMRK) financed data center project located?

The data center project is located within the 300+ acre Chirisa Technology Park in Richmond, Northern Virginia.

What is the power capacity of the Newmark (NMRK) financed data center?

The build-to-suit data center will have a power capacity of 50 megawatts.