Meta, BlackRock partner on $14 billion El Paso data center venture

Meta Platforms and BlackRock on Tuesday unveiled a joint venture to develop and operate a new data center campus in El Paso, Texas, with a projected development cost of approximately $14 billion. This initiative is a response to the escalating demand for AI infrastructure, prompting tech companies to seek substantial external capital.

Under the terms of the venture, BlackRock-managed funds will acquire an 80% ownership stake, backed by $12.5 billion in debt financing, while Meta will retain 20% and receive a $1 billion distribution. Meta's contribution includes land and in-progress construction assets valued at $2.3 billion, complemented by BlackRock's cash contribution of $4.9 billion. Meta will enter into lease agreements with the venture, allowing it to access computing capacity without directly funding or owning the campus, a strategy to address investor scrutiny over AI investment costs.

The El Paso data center, already under construction and expected to be operational by 2028, is designed to deliver 1 gigawatt of compute capacity, crucial for Meta's AI technologies and core business operations. This project aligns with Meta's broader plan to invest $600 billion in AI infrastructure and job creation across the U.S. by 2028, aiming to accelerate personal superintelligence development. The company has also appointed Dina Powell McCormick to enhance partnerships with governments and investors for its AI initiatives. Morgan Stanley & Co and J.P. Morgan Securities served as financial advisors to Meta for this transaction.