Meta, BlackRock partner on US$14 billion El Paso data centre

Meta Platforms and asset manager BlackRock announced a $14 billion joint venture to develop and operate a data center campus in El Paso, Texas. BlackRock-managed funds will acquire an 80% ownership stake in the venture, with Meta retaining the remaining 20%. A significant portion of BlackRock's investment, $12.5 billion, will be debt-financed.

Meta will contribute approximately $2.3 billion in land and in-progress construction assets, while BlackRock will make a cash contribution of about $4.9 billion. Meta plans to enter into lease agreements with the venture, allowing it to secure necessary computing capacity without directly funding and owning the entire campus. This strategy reflects a broader trend among tech giants seeking external capital for their substantial AI infrastructure investments amidst investor scrutiny over costs.

The El Paso data center campus, which is already under construction, is projected to provide 1 gigawatt of compute capacity, critical for Meta's AI technologies. Operations are slated to begin in 2028. Meta has previously stated its intention to invest $600 billion in AI infrastructure, including data centers and new jobs across the U.S. by 2028, with the goal of accelerating personal superintelligence. This includes developing several gigawatt-scale data centers nationwide, such as a potential 5-gigawatt expansion in rural Louisiana with investments potentially exceeding $50 billion. The rapid expansion of AI data centers has also encountered public opposition, with 142 protests reported across 42 states earlier this month. Morgan Stanley & Co and J.P. Morgan Securities advised Meta on this transaction.