Hyperscale cloud computing companies, e.g. Google, Amazonand Microsoft Capital expenditure investments will reach a staggering $500 billion this year. Google alone is expected to invest $175 billion to $185 billion by 2026, up from $91.5 billion last year. That’s well above the $115 billion analysts expect the tech giant to invest this year as it ramps up spending on artificial intelligence computing power — servers, data centers and network equipment.
Tech companies aren’t the only ones investing heavily in building new data centers. lead Data Center Real Estate Investment Trust Equinics (NASDAQ: EQIX) is rapidly expanding its global data center platform to support the expansion of hyperscalers and other customers. These investments can make REIT The value will double in the next few years.
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Equinix is ​​one of the world’s largest real estate investment trusts. At the end of the third quarter, the company operated 273 data centers in 77 markets (36 countries). Its global data center portfolio supports more than 10,000 customers, including Google, Amazon and Microsoft. The tech giants lease space from Equinix and are cloud service partners.
Demand for space in REIT portfolios is strong and growing. Annualized bookings in the third quarter reached a record high of US$394 million, a year-on-year increase of 25% and a quarter-on-quarter increase of 14%. Equinix has closed more than 4,400 transactions with more than 3,400 customers, including cloud and artificial intelligence service providers. That helped drive a strong 11% increase in the company’s adjusted funds from operations (FFO) in the quarter.
As part of its strategy, Equinix is ​​investing heavily to expand its data center capacity faster. Build bolder strategy. The company currently has 58 major projects underway globally, including 12 xScale data centers (AI-ready hyperscale data centers). The company added seven new projects in the third quarter and expanded its land bank in multiple metro areas to support future development.
Data center REITs now have room to deploy 3 gigawatts of capacity. This is part of its strategy to double its data center capacity by 2029. CEO Adaira Rita Fox-Martin noted that its “aspiration is to have as much online capacity in the next five years as it has in the past 27 years.”
Under the plan, Equinix plans to invest $4 billion to $5 billion in capital annually from 2026 to 2029, up from last year’s guidance range of $3.5 billion to $3.9 billion. This level of investment should support strong Revenue, adjusted FFO and dividend growth rates over the next few years.
