There’s no end in sight for the ongoing proliferation of data centers. Statista, for example, forecasts continuous investment in data center technology with total global revenue from data centers to surpass USD 400 billion by 2027. That’s because, as the home of the cloud and the place where data is stored and processed, they are increasingly becoming critical infrastructure for organizations in the digital age. As more and more services move online, businesses rely on data centers for higher performance and lower latency times.
Much debt has already been raised for data center transactions, with EUR 56 billion raised between 2016 and 2022 (as of October) according to Infralogic, which will largely come due for refinancing over the coming years. Funding the continued growth of data centers requires further bank debt and financing solutions that are tailored to the specific needs that come with such a project. By leveraging its deep technical expertise and working closely with its customers, this is precisely what Siemens Financial Services (SFS), the financing arm or Siemens, offers to bring their ambitions to life.
One recent example of financing in this area is SFS’ involvement with Vantage Data Centers, a leading global provider and operator of hyperscale data center campuses. Vantage entered the EMEA market back in 2020 with a USD 2 billion investment pipeline, acquiring Etix Everywhere in Luxembourg and Next Generation Data Centers in the UK as well multiple greenfield developments in Frankfurt, Berlin, Milan, Warsaw, Johannesburg and Zurich. Aiming to expand its footprint in Europe, Vantage approached the European banking market, to fund its greenfield projects in Zurich, Berlin and Frankfurt using two separate portfolio financing structures – both co-financed by SFS.
Thanks to Siemens Financial Services, all the right partners came together. This offers enormous growth potential as market demands evolve.Nick Haslehurst, CFO, EMEA Vantage Data Centers
SFS through Siemens Bank together with other banks provided up to EUR 790 million in two distinct secured loan transactions to fund these new greenfield developments. Thanks to the support of SFS, Vantage was able to raise limited recourse senior secured debt to continue its rapid global growth and industry-leading time-to-market strategy. The projects are a signal of a strengthening customer relationship between Siemens and Vantage.
By providing this loan, Siemens is bringing the partnership with Vantage Data Centers to a higher level then a pure customer/supplier relationship. Siemens is demonstrating commitment and belief in Vantage growth plans and together we are sharing visions on how to shape the Datacenter industry more sustainable.Marc Debraekeleer, Corporate Account Manager Datacenters, Siemens Smart Infrastructure
Vantage isn’t alone, as the European data center market on the whole is on the brink of massive growth – a 60 per cent increase in revenue in the next six years – with Germany leading the charge as the country with the most data centers in Europe. As the importance of data centers continues to grow, so too does the importance of appropriate financing solutions. SFS is ideally positioned as a partner to support investment this dynamic sector. Furthermore, in light of the energy consumed by data centers, greenfield financing success stories such as Vantage, demonstrate that these projects can be undertaken in a sustainable way.
With its track record and its unique combination of industry and financing know-how, SFS is in an optimal position to support new and upcoming technologies driving digital transformation by commercializing complex and capital-intensive projects such as data centers.