Analysis of the Strategic Logic Behind Private Equity Firms' Large-Scale Investments in Data Center Assets

Based on the latest collected data and industry information, I provide you with a systematic and comprehensive analysis.

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According to the latest information, on January 7, 2026, private equity giant KKR announced an additional

equity commitment to European data center service provider Global Technical Realty (GTR), while Oak Hill Capital joined as an investor with a commitment of approximately , bringing the total investment scale to [1][2].

• Founded in 2020, co-established by data center entrepreneur Franek Sodzawiczny and KKR
• Focuses on designing and building customized, sustainable data centers for hyperscale cloud service providers
• Has grown into one of Europe’s leading custom data center developers and operators
• Built a strong business footprint in key high-growth markets[1][3]

• To date, KKR has committed a total of
  $34 billion
  in the digital infrastructure sector, completing
  24 investments
• Simultaneously invested over
  $20 billion
  in the power and renewable energy sectors
• Owns 5 data center platforms, covering the US, Asia-Pacific, and European markets
• Has a total of more than
  155 facilities
  and a
  12GW development pipeline
  [2][3]

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Artificial intelligence is the fundamental driving force behind the data center investment boom:

Forecasting Source	Data Center Demand Forecast	Time Horizon
Goldman Sachs Research	Data center demand will grow by approximately 50% to 92GW	By 2027
Goldman Sachs Research	Compound Annual Growth Rate (CAGR) of 17%	2025-2028
McKinsey	$5.2 trillion in investment required to meet AI demand	By 2030
McKinsey (Scenario 2)	$7.9 trillion in investment required	In the accelerated scenario

Goldman Sachs Research shows that in an optimistic scenario, if GPUs require more power or AI model demand exceeds expectations, the CAGR could reach

[4][5]. This deterministic growth is the most valued investment logic for private capital.

As Brad Haller, Senior Partner at West Monroe, stated: “Data centers are ‘Steady Eddie’ investments. You can build a fairly predictable internal rate of return, and then you can make more forward-looking risk bets elsewhere”[6].

• Long-term lease income
  : Data centers typically sign long-term leases, providing stable cash flow
• High demand visibility
  : The development path of AI is relatively clear, making it easy to forecast capacity demand
• Diversified exit channels
  : Options include IPO, REIT conversion, sale to strategic buyers or infrastructure funds
• Inflation hedge
  : As data demand grows, rents and asset values have upward momentum[6][7]

Data shows that

, and has been the dominant force since 2021[8]. The total value of data center M&A transactions in 2024 reached [8].

• Blackstone acquired AirTrunk for
  $16.1 billion
  (2024)
• KKR acquired CyrusOne for
  $15 billion
  (2022)
• DigitalBridge and Silver Lake invested
  $9.2 billion
  in Vantage Data Centers
• KKR reached a “multi-billion dollar” investment agreement with Compass Datacenters (December 2025)[9][10]

KKR’s choice of GTR reflects special attention to the European data center market:

• Market gap
  : Europe has relatively low data center penetration, with huge growth potential
• Regulatory advantages
  : EU requirements for data sovereignty and localization drive the construction of local data centers
• Energy transition
  : European green data center construction standards align with ESG investment concepts
• Customer demand
  : US hyperscale cloud service providers (AWS, Azure, Google Cloud) are expanding on a large scale in Europe[2][3]

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The involvement of private capital has accelerated industry consolidation, forming a competitive landscape of “the strong get stronger”:

Ranking	Company	Market Share
1	Equinix	13%
2	Digital Realty	11%
3	NTT	6%
Others	-	70%

It is worth noting, however, that new entrants supported by private capital are rapidly changing the market landscape. Since its acquisition, Blackstone’s QTS Data Centers has seen its leased capacity grow

and its developable land reserve grow [11].

• North America
  : A mature market with fierce competition, but AI demand continues to drive expansion
• Europe
  : A key target region for private capital such as KKR, with opportunities to “overtake on the curve”
• Asia-Pacific
  : Brookfield, DigitalBridge, etc. are actively deploying; the AirTrunk acquisition marks recognition of regional value
• Middle East
  : KKR has established a major platform-level partnership with Gulf Data Hub[2][10]

The data center investment boom is reshaping the upstream and downstream industry chains:

• Power infrastructure (power generation, transmission and distribution)
• Industrial equipment (cooling systems, power supply equipment)
• Semiconductors (GPUs, custom chips)

• Data center developers/operators
• Land and property holdings
• Interconnection platforms

• Cloud service providers
• AI/ML companies
• Enterprise users[5][6]

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• Equinix (EQIX): Industry leader with the largest market capitalization
• Digital Realty (DLR): Focuses on hybrid cloud and data gravity strategies
• QTS Realty (owned by Blackstone, privatized)
• Iron Mountain (IRM): Transforming from storage to data centers

• Platform-level investments (such as KKR’s investment in GTR)
• Funds specializing in specific regions or niche markets
• Infrastructure debt and mezzanine financing[7][12]

Industry Chain Segment	Investment Target Type	Representative Opportunities
Power Supply	Utilities, power generators	Partnership with Energy Capital Partners
Equipment Manufacturing	HVAC, power supply equipment	Schneider Electric, Eaton
Land/Property	Data center land, industrial real estate	GTR model
Interconnection	Network infrastructure	Equinix interconnection business
Cloud Services	IaaS/PaaS	AWS, Azure, GPUs

• With the popularization of AI applications, demand for edge data centers is growing rapidly
• Private capital has begun to focus on edge AI and modular data centers[6]

• ESG investment trends drive the construction of green data centers
• Renewable energy integration and carbon neutrality have become differentiated competitive points

• Private credit is playing an increasingly important role in AI infrastructure financing
• In August 2025, Meta arranged
  $29 billion
  in hybrid financing for its data center expansion, with funds coming from private capital such as PIMCO[6]

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• Power and grid constraints have become bottlenecks
• Shortages of qualified construction personnel and key equipment
• Fluctuations in construction costs[6]

• Uncertainty in AI development paths
• Technology substitution risks (photonic computing, quantum computing, etc.)
• Customer concentration risk (over-reliance on a small number of hyperscale service providers)[6]

• Changes in data localization regulations
• Stricter environmental/carbon emission regulations
• Cross-border data flow policies[8]

• Uncertainty in IPO windows
• REIT conversion requires meeting specific conditions
• Limited number of strategic buyers[7]

• Long-term institutional investors (pension funds, insurance funds)
• Infrastructure funds
• Private equity funds
• Diversified investors with allocation needs for technology infrastructure

• It is recommended to allocate data centers as an asset class of “digital infrastructure”
• Core/core-plus strategies are suitable for investors with lower risk appetites
• Value-add/opportunistic strategies are suitable for investors with higher risk tolerance
• Moderate diversification across regions and industry chain segments is recommended[6][7]

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KKR’s

investment in GTR is an important signal that private capital continues to bet on data center assets, reflecting the following core trends:

1. AI-driven long-term growth
   : Data centers have become the “infrastructure” of the AI revolution, with highly deterministic demand growth
2. Private capital leads consolidation
   : 80-90% of M&A transaction value is contributed by private capital, and the industry landscape is being reshaped
3. Accelerated global layout
   : Relatively underdeveloped markets such as Europe have become new investment hotspots
4. Expansion of industry chain value
   : Extending from data center operators to upstream power, equipment, and downstream cloud services

For investors, data centers represent a core infrastructure asset class in the digital economy era. Against the backdrop of sustained growth in AI computing power demand, this field will continue to attract large amounts of capital inflow. However, investors also need to carefully evaluate risk factors such as construction cycles, exit channels, and regulatory environments.

• Actual commercialization progress and profit model validation of AI
• Matching progress between data center construction and power supply
• Impact of interest rate environment changes on valuations
• Evolution of regulatory policies (especially EU carbon neutrality requirements)

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[1] Yahoo Finance - “KKR and Oak Hill Capital Commit Nearly $2 Billion to Leading European Data Center Platform Global Technical Realty” (https://finance.yahoo.com/news/kkr-oak-hill-capital-commit-120000862.html)

[2] Data Center Dynamics - “European data center operator GTR secures $1.9bn from KKR and Oak Hill” (https://www.datacenterdynamics.com/en/news/european-data-center-operator-gtr-secures-19bn-from-kkr-and-oak-hill/)

[3] Business Wire - KKR Press Release (https://finance.yahoo.com/news/kkr-oak-hill-capital-commit-120000862.html)

[4] Goldman Sachs - “How AI Is Transforming Data Centers and Ramping Up Power Demand” (https://www.goldmansachs.com/insights/articles/how-ai-is-transforming-data-centers-and-ramping-up-power-demand)

[5] McKinsey - “The cost of compute: A $7 trillion race to scale data centers” (https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/the-cost-of-compute-a-7-trillion-dollar-race-to-scale-data-centers)

[6] Ropes & Gray LLP - “Artificial Intelligence - Q3 2025 Global Report” (https://www.ropesgray.com/-/media/files/alerts/2025/11/artificial-intelligence-q3-2025.pdf)

[7] Georgetown School of Business - “Private Equity and Data Centers Exit Strategies Explained” (https://globalrealassets.georgetown.edu/insight/private-equity-and-data-centers-exit-strategies-explained/)

[8] Global Data Center Hub - “Data Center Consolidation: Strategic Implications of the M&A Surge” (https://www.globaldatacenterhub.com/p/data-center-consolidation-strategic)

[9] Bisnow - “KKR To Invest Billions In Portfolio Of Brookfield-Backed Compass Datacenters” (https://www.bisnow.com/national/news/data-center-capital-markets/kkr-invests-billions-in-portfolio-of-brookfield-backed-compass-datacenters-132236)

[10] Freshfields - “The Digital Gold Rush: Investment in Data Centres and Related Legal Issues” (https://transactions.freshfields.com/post/102lucb/the-digital-gold-rush-investment-in-data-centres-and-related-legal-issues-for-in)

[11] Blackstone Real Estate Income Trust - “Q3 2025 Update” (https://www.breit.com/q3-2025-update/)

[12] Brightlio - “255 Data Center Stats (September-2025)” (https://brightlio.com/data-center-stats/)