QTS Data Centers: QTS Realty Secures a $800m Data Center Refinancing Contract

May 25, 2023 | Posted by Abdul-Rahman Oladimeji

QTS Realty, owned by Blackstone, has refinanced four data center properties. Citigroup leads a consortium of four institutions that provided the loan. It will be used to refinance QTS' existing $667 million debt and provide the funds necessary to finance tenant build-outs.

The refinancing is given as a commercial mortgage-backed securities (CMBS) offering, and while it covers four data centers, it is primarily based on the two Ashburn-Shellhorn data centers in Loudoun County. Together, the data centers encompass 618,000 square feet, and 99.5% of the 80MW of IT capacity has been assigned to 28 separate tenants. The BX 2023-VLT2 CMBS offering is a single asset, single creditor transaction. The other two sites are a mixed-use building in Atlanta, Georgia, and a data center in San Antonio, Texas.

This year's data center securitizations have exceeded $3 billion, double the amount of 2022. In April of this year, CyrusOne released $701 million in CMBS with its Virginia and Texas data center, and Cologix concluded a $144.7 million securitization of its assets during the same month. According to CoStar, this represents 10% of all CMBS transactions this year.  QTS's portfolio comprises 36 data center properties with a combined 1,200MW across the US and Europe.