In an attempt further expand its portfolio, which remains heavily concentrated in toll roads, ports and electricity networks, the country’s biggest super fund, AustralianSuper has made its first “significant venture” into data centres.
Due to unprecedented demand for data, the digital infrastructure asset class is seen as a sweet spot for infrastructure investment right now.
What’s driving the growth in data centre capacity – to hundreds of megawatts – Robin Khuda of AirTruck told an Australian Financial Review Property Summit early this week is the massive uptake of AI to meet surging demand from companies in cloud computing and “big data”.
“The level of growth we are seeing right now is something we have not seen in 10 years,” Khuda noted.
Adding to its $40 billion-plus infrastructure portfolio – including WestConnex, Sydney Airport, and the Peel Ports in the UK – the super fund has acquired a $2.5 billion significant minority stake (circa 20-40%) in Denver-based developer Vantage Data Centers, which owns 30 [hyperdata] campuses across 18 markets globally.
Hyperscale data centres
Hyperscale data centres tend to attract global infrastructure investors due to the length of their contracts, and the quality of their clients which include the likes of Google, Amazon and Microsoft.
Vantage Data Centers CEO Sureel Choksi expects the AustralianSuper investment to fast-track the company’s data centre footprint across, Asia, the Middle East and Europe.
“This investment will fuel Vantage’s ability to accelerate the growth of our environmentally friendly, large-scale data centre footprint across the region and further deepen our relationships with customers as we enable them to grow and scale their businesses with reliable, efficient and sustainable data centres.”
It’s understood that global alternative investment manager DigitalBridge, remains the major shareholder.
Strong pipeline in growth markets
AustralianSuper’s head of infrastructure Nik Kemp, who’s been eyeballing opportunities in the digital infrastructure space for some time, expects the stake in the Vantage EMEA platform to provide access to an attractive market that has delivered strong growth and returns in recent years.
“The Vantage EMEA platform is at an exciting point in its history, with a strong pipeline of developments in growing markets across the region,” Kemp said.
“We look forward to working with DigitalBridge and Vantage EMEA to continue to support the rapid growth of its customers while also delivering on our purpose to help more than 3.2 million members achieve their best financial position in retirement.”
Commenting on AustralianSuper’s stake in Vantage, DigitalBridge senior managing director Jon Mauck notes the resilience of digital infrastructure as an asset class.
“We look forward to building on our track record as we become a partner of choice to Australian investors seeking to increase their exposure to high-quality digital infrastructure investments.”
All going to plan, the transaction is expected to close in Q4 2023, subject to customary closing conditions.
