New York-based private equity firm Stonepeak Infrastructure Partners has set up a new data center builder in APAC,to be led by data center executives from firms including Equinix, Faceboo, Tata amd Macquarie
Digital Edge, will have a starting fund of $1bn, to acquire and build facilities in the region - including a 12MW site in Osaka and a stake in a Tokyo data center owned by local provider Itochu Techno-Solutions Corporation.
Been there, ran the data center, got the t-shirt
New $1 billion data center ventures are not that unusual. This is the second such venture to launch this year, following April announcement from, Equinix and GIC of a $1 billion joint venture to build hyperscale data centers in APAC. that followed a similar announcement from Equinix and GIC for European wholesale facilities in late 2019. In May this year, investor KKR put up $1 billion to launch Global Technical Realty., which gathered European data center veterans to build in Europe.
The APAC region is experiencing a rapid expansion of its data center capacity, as it is home to some of the world’s largest and most technologically-advanced - and most rapidly developing - economies. The surge is led by Hong Kong or Singapore, as the latter has the largest concentration of submarine cables in the region and has good connectivity to the world, while Hong Kong is seen as a gateway to access the Chinese market. Japan, meanwhile, has a large domestic market and potential for growth, while India has a population of 1.35 billion who are increasingly reliant on digital infrastructure.
The new firm says the biggest struggle investors find when seeking to develop data centers in the region is that the cultural norms of how to do business are different to the West, and it often takes partners on the ground to get a foot in the door.
Digital Edge’s management team comprises a consortium of industry veterans, most of whom have spent their careers working in APAC: Equinix’s former President, Samuel Lee, will be the new entity’s CEO, joined by ex-managing director for Japan, Kei Furuta, as well as Andrew Rigoli, who was the company’s VP for corporate development in Singapore and South East Asia, and Jonathan Choufrom, who spent 17 years at Equinix and spent his last decade there as VP for corporate development in APAC; Jay Park, who was vice president of data center infrastructure at Facebook; former chief legal officer at Tata Communications, John Freeman, and Jonathan Walbridge, who was the managing director at financial services company Macquarie Group for 14 years.
New-York based Stonepeak will bring equity to the table, as well as experience in the management of communications infrastructure. It has a majority stake in North American data center service provider Cologix and also in European fiber optic provider euNetworks. It recently bought Canadian broadband company Xplornet Communications.
Samuel Lee said Digital Edge’s management is enthusiastic to work with Stonepeak, and “to have completed the initial capacity acquisitions to fulfill our vision of bridging the digital divide in the Asia-Pacific region. The transactions in Tokyo and Osaka give the platform a dual footprint offering to customers in Japan’s two primary data center markets.”
Brian McMullen, senior managing director at Stonepeak, said, “The Asia Pacific digital infrastructure market is among the fastest growing in the world, with demand continuing to outpace supply. We are delighted to partner with Samuel and his team, who bring unparalleled experience and an exceptional track record of development, and are investing in Digital Edge to help us achieve our shared vision for the region.”