The AI boom has quickly become a focal point for private infrastructure investors, with funds targeting data centers and telecommunications accounting for 64% of total infrastructure capital raised in the first quarter, according to PitchBook’s Q1 2025 Global Real Assets Report.
However, as investors funnel capital into these assets, strategies vary widely in their risk and return profiles. Some firms are acquiring stakes in established operating assets, others are building platforms that combine existing facilities with development pipelines, and many are pursuing bespoke facilities tailored to the growing demands of hyperscalers.
Further, as power emerges as a growing bottleneck to bringing new facilities online, joint ventures and strategic partnerships between infrastructure investors, energy providers, and data center developers are becoming more common across the deal landscape. Here, we examine recent transactions that illustrate how these models are taking shape and their distinct considerations.
In April, Stonepeak unveiled the launch of Montera Infrastructure, a new North American data center platform backed by their $1.5 billion equity investment. The venture will concentrate on turnkey, build-to-suit facilities in Tier 1 and Tier 2 markets, targeting the surging demand from cloud computing and AI workloads. As it ramps up its greenfield pipeline, Montera will prioritize securing land parcels with near-term access to power, developing facilities of up to 100 megawatts each.
The launch marks Stonepeak’s fourth data center investment in North America and its eighth globally. The firm’s portfolio already includes stakes in Cologix, CoreSite, and Digital Edge, spanning more than 100 facilities with over 500 megawatts of capacity and an additional 400 megawatts in development.
Investors are increasingly showing a strong interest in hyperscale data centers, due to the attractive characteristics these facilities bring. There is strong forward-looking demand for these data centers due to the massive growth of AI and ML workloads. For example, global demand for hyperscale data centers alone is projected to reach $593 billion by 2030.
Notably, these facilities are built on a far larger scale than typical data centers, requiring significantly more power, physical space, and upfront capital. In return, once construction is complete, they deliver long-term contracted revenues from some of the most sought-after blue-chip clients.
That said, while those traits align with traditional infrastructure, the process of building a data center development from the ground up carries its own execution risk. Data center construction is fraught with challenges — from complex permitting to securing reliable power — that can start to flex the risk-return profile of traditional infrastructure.
It is also worth viewing the investment within the context of the firm’s broader data center portfolio, which underscores the diversification and complexity that can exist even within a single infrastructure sector. For example, Stonepeak’s portfolio blends operating facilities with a robust development pipeline. Many of these projects may start as core-plus or value-add assets but transition to core once operational and backed by contracted revenues.
Last December, Intersect Power announced a strategic partnership with Google and TPG Rise Climate to deliver gigawatts of new US data center capacity powered by co-located renewable energy and storage projects. The collaboration, backed by an $800 million funding round led by Google and TPG alongside existing investors, Climate Adaptive Infrastructure and Greenbelt Capital Partners, is expected to catalyze up to $20 billion in clean energy infrastructure investment by the end of the decade.
With this capital, Intersect plans to develop industrial parks pairing large-scale data centers with new clean energy plants. The first project is already in financing and slated to begin operations in 2026 before reaching full completion in 2027.
Two of the biggest forces in capital formation — decarbonization and digitalization — are increasingly converging, and this deal underscores how that intersection is reshaping deal structures and partnerships across the infrastructure landscape.
With power emerging as the key bottleneck to the AI boom, a “power-first” approach to development can accelerate new projects. By co-locating large-scale renewable generation and battery storage at data center sites, developers can build facilities powered by high shares of clean energy while avoiding lengthy grid interconnection delays.
Under the partnership, Intersect Power will construct new clean energy assets, with Google serving as the anchor tenant and offtaker through newly built data center campuses in co-located industrial parks. Once operational, the Google facilities will come online with dedicated clean power, adding new generation capacity to the grid while meeting their own load. The structure offers mutual benefits. Intersect secures long-term contracts with a blue-chip client, while Google gains reliable, renewable power to fuel its data center consumption.
Amid the massive power demands driving the AI revolution, concerns over the emissions impact of data centers are mounting. Yet, many hyperscalers — including Google, one of the sector’s largest and most influential clients — have set net-zero targets and continue to enforce sustainability and efficiency requirements on new buildouts. For instance, with a 1.09 power usage efficiency score (PUE), Google’s data centers rank among the most efficient in the world, operating well below the industry PUE average of 1.5 to 1.6.
Apollo recently completed a carve-out of Stack Infrastructure’s European colocation business, creating a new entity that will focus on expanding colocation services across the region. The deal allows Stack to sharpen its focus on hyperscale clients, while Apollo gains a portfolio of seven data centers in key European markets, including Stockholm, Oslo, Copenhagen, Milan, and Geneva. These colocation facilities serve a broad mix of enterprise customers, from telecom carriers and IT service providers to financial institutions.
While hyperscale development has captured much of the spotlight in recent years, the cloud buildout to support enterprises is still in its early stages. Many of these enterprises rely on colocation data centers to host their services, a model that carries its own set of unique considerations for investors.
Unlike hyperscale facilities, which rely on a single client and carry greater tenant concentration risk, colocation centers draw revenue from a broader, more diversified customer base. Their leases, however, are typically shorter than those of hyperscale operators, requiring ongoing leasing efforts to sustain occupancy. While this creates less certainty around contracted revenues, it also enables higher rates and, in turn, potentially stronger returns. From a value-creation standpoint, maintaining high occupancy remains one of the most critical drivers.
CPP Investments and Deutsche Bank recently committed C$450 million (US$320 million) to finance the expansion of a data center in Cambridge, Ontario, transforming a former BlackBerry facility into a next-generation operation. CPP Investments will contribute C$225 million through a 50% interest in a construction loan, with Deutsche Bank Private Credit and Infrastructure providing the remaining half as lead lender. The project, a joint venture between Related Digital, TowerBrook Capital Partners, and Ascent, will deliver a 54-megawatt hyperscale expansion already pre-leased to a GPU-focused AI cloud provider on a long-term basis.
One way to de-risk greenfield data center projects is to secure a pre-leased anchor tenant. While significant challenges can still arise, many investors view pre-leasing as a key hedge against the risks inherent in new development. This deal also highlights how some investors are addressing demand by expanding or retrofitting existing facilities to accommodate growing needs.
More broadly, the evolution of the infrastructure sector and the rise of private infrastructure debt are opening new opportunities for public pension investors. With its ability to deliver inflation-linked income, downside protection, and attractive risk-adjusted returns, financing infrastructure projects is a natural fit for pension portfolios to match their long-term liabilities with attractive income sources.
As a result, it comes as no surprise that pensions have been increasing their infrastructure allocations in recent years, with Canadian funds among the most active players. On average, infrastructure makes up about 11% of Canadian pension portfolios — one of the largest allocations globally. A key driver is the so-called “Canadian pension fund model,” which emphasizes direct and co-investment fueled by internal asset management capabilities.
Ultimately, as investors expand data center portfolios across a range of deal structures, value-creation models, and risk-return profiles, the ability to capture comprehensive operational data is becoming critical. Chronograph GP enables deal teams to track granular, quantitative and qualitative KPIs at the asset and portfolio-company level while preserving harmonization for portfolio-wide analysis. Further, by automating reporting and valuations, deal teams save critical time and can refocus on their core priorities — sourcing attractive assets and competing for deals in the data center market.
Explore our Private Infrastructure Report to see how investors are deploying capital across the data center and power value chains, navigating complex strategies, and using operational data to gain a competitive edge.
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