Blackstone Plans to Expand Data Centre Capacity in India
Data Centre Capacity expansion in India – Blackstone, a global fund house, is expecting a significant increase in its data centre capacity in India in the near future. This growth is being driven by the rising popularity of cloud services, 5G technology, and data protection measures in the country.
The company’s data centre platform, Lumina Cloud Infra, is currently constructing two large data centres in Navi Mumbai, with a combined capacity of 60 megawatts. These facilities are expected to be operational within the next 12-18 months.
Growing Demand
According to Asheesh Mohta, head of real estate acquisitions in India for Blackstone, there is a threefold increase in demand for data centres in the country. The adoption of cloud services, 5G technology, and data protection measures has been a game changer for the industry.
Mohta mentioned that the low cost of data and the relatively small existing infrastructure in India are additional advantages for the data centre business. However, he noted that challenges remain in terms of securing access to power and land. Overcoming these challenges will be crucial for unlocking further growth opportunities.
Blackstone intends to finance its data centre business using its own funds and may also consider taking on construction debt. Mohta highlighted the capital-intensive nature of the business, with the cost of building one megawatt of data centre capacity still amounting to Rs 50 crore.
Mohta also pointed out that there is a strong global demand for data centres, indicating significant growth potential for the industry.
Monetizing Warehousing Business
In addition to its data centre operations, Blackstone is planning to monetize its warehousing business within the next year or two. Mohta mentioned that this will happen once the business reaches a certain scale and value.
While the company may not opt for a real estate investment trust (REIT) structure for its warehousing business due to regulatory constraints, it is exploring other avenues for growth. Mohta emphasized the importance of cash flows in sectors poised for growth, such as hospitality.
Blackstone’s warehousing platform, Horizon Industrial Parks, currently has a portfolio of 50 million square feet, with half of the space already developed. The company plans to build out the remaining space over the next few years.
According to Mohta, land ownership is a critical factor in the warehousing business, with land aggregation being a major challenge. Blackstone prefers to pay landowners for access to land rather than engaging in large-scale land aggregation efforts.
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