GI Partners Acquires Data Center in Northern Virginia

GI Partners, a private equity firm with deep experience in the digital infrastructure sector, has acquired a data center in Sterling, Virginia that is leased by a large technology firm, the company said today.

GI Partners bought the facility at 22262 Cloud Plaza from Sentinel Data Centers, which will retain a minority interest in the ownership of the property. The 238,000 square foot data center was delivered and fully commissioned in 2019, and offers 46 megawatts of critical power while serving as a key network location for the tenant.

“We are excited and proud to own one of the most densely networked data centers in Northern Virginia, the nexus of the world’s internet traffic,” said John Sheputis, Managing Director at GI Partners and Head of Acquisitions for GI Partners Real Estate. “We are seeing increased net absorption for data center capacity broadly, and users placing premium value on locating at network-differentiated assets like Cloud Plaza. We believe that the addition of this fortress-like asset to our data center portfolio will reduce our overall risk while providing accretive returns over the long-term.”

GI Partners is a veteran player in the sector, operating dozens of data centers as well as colocation provider Flexential, which targets second-tier markets. It is perhaps best known for its sponsorship of Digital Realty Trust, which was created using data center assets that GI Partners acquired during the “dot-com bust” in the early 2000s. GI Partners also has a lengthy list of private equity investments with successful exits, including The Telx Group, The Planet, SoftLayer Technologies, ViaWest, and Wave Broadband.

Last month GI Partners raised $1.45 billion for its newest vehicle, the Tech+Science Fund, to invest in real estate supporting the technology and life sciences industries. The fund is headed by Sheputis, who previously led Infomart Data Centers and Fortune Data Centers.

Another Success for Sentinel

The deal is the latest transaction for Sentinel Data Centers, an experienced data center developer who has built and sold several significant data center portfolios. The company has built other data centers in Northern Virginia for hyperscale tenants, and owns more than 300 acres of development parcels in “Data Center Alley” in Ashburn. The company also operates single-tenant data centers in Memphis and Rockland, N.Y.

“The GI Partners Real Estate team has been great to work with and a real class act,” said Josh Rabina, Co-CEO of Sentinel Data Centers. “We are thrilled to be investing alongside GI Partners and continuing our involvement with this amazing asset.”

Sentinel was founded in 2001, and has delivered 2 million square feet of data centers, selling portfolios to Digital Realty in 2009 and CyrusOne in 2017.