Data Center Alley in northern Virginia continues to attract significant investment. Hyperscale provider Vantage Data Centers closed a $300 million green loan for its upcoming VA13 facility in Ashburn, Virginia. European Investment Bank Societe Generale provided the funds.
VA13 will be built on Vantage’s 43-acre campus in Ashburn. The new facility will total 365,000 square feet and will deliver 44 megawatts when construction is complete. It will be the third of five data centers planned in total for the 146 megawatt, 1 million square foot campus. Tenants will have access to average power densities of 200 watts per square foot. VA13 is expected to go live later this year.
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The Vantage facility will need to meet specific criteria to qualify for the funding, including water conservation, reduced carbon emissions and achieving low energy use efficiency. According to Chief Financial Officer Sharif Metwalli, the loan will allow the company to prioritize speed to market without sacrificing sustainability. Last year, Vantage pledged to achieve net zero emissions by 2030.
Campus sustainability features will include efficient cooling with outdoor air savings, low water consumption, lighting powered by wind and solar energy sources, and electric vehicle charging stations and landscaping. drought resistant landscaping. Power will be provided by Dominion Energy, one of Virginia’s leading data center power providers. According to its website, the company supplies electricity to more than 12 million square feet of data centers.
Green data center financing takes off
This is the second green loan obtained by Vantage. The data center provider has already received a $68 million multi-phase loan, also from Société Générale, for its 32-megawatt facility in Quebec. This data center became operational last month. Vantage also plans to leverage green financing for future developments.
Green financing, whether through green loans or sustainability-linked loans (SLLs), is gaining popularity in the data center industry. Both funding options are tied to sustainability-related goals. Proceeds from green loans must be used to finance a sustainable project, in this case the development of a green building. SLLs, on the other hand, are directly linked to the sustainability profile of the borrower – during the life of the loan, the borrower must achieve pre-agreed ESG-related KPIs.
Both financing options have seen growing popularity with data center developers. This year, Data Centers Aligned increased its SLL from $375 million to $1.75 billion. Last year, the company issued $1.4 billion in the first-ever green data center securitization. Similarly, the colocation provider Flexible issued $1.6 billion in asset-backed greenbacks last year as part of its green financing network.
CBRE research shows that data center providers and end users are prioritizing carbon neutral goals and clean energy solutions, but the industry’s rapid growth makes this a particularly difficult issue. Site selection will likely be affected, and markets with an abundance of renewable energy will likely see an increase in new developments.