Sabey Data Centers Closes $675 Million Financing Led By TD Securities
Funds will be used for recapitalization of existing property-level debt, and capital expenditures for data center development.
Sabey Data Centers has announced that it has closed a financing transaction led by TD Securities consisting of a $425 million 5-year term loan and a $250 million 5-year revolver. The transaction was upsized by $50 million amid meaningful oversubscription.
Proceeds of the term loan will be used to refinance existing property-level debt into a corporate facility, while the revolver will be used to fund capital expenditures for data center development and strategic initiatives. In connection with strong demand trends, the company plans to expand its data center campus in Northern Virginia, the largest and fastest growing data center market in North America, as well as in Central Washington, which benefits from low power rates and a mild climate ideal for efficient cooling.
“From a strategic perspective, this transaction will provide the capital we need to stay ahead of market conditions. The data center development market is extremely active, especially with prospective tenants who are demanding large blocks of inventory as a condition for entering into a lease deal,” said Rob Rockwood, president, Sabey Data Centers.
“The leasing paradigm has changed. Up to the recent past, data center users would move onto a campus and then build out incrementally, on an ‘as needed’ basis. This is no longer the case,” he added.
"TD Securities is pleased to have had the opportunity to work with Sabey Data Centers on this financing transaction. Management has done an excellent job of executing on their investment thesis and we are excited to provide the company with ample financing capacity to support their next wave of expansion and organic growth. We look forward to continuing to support the company’s strategic growth initiatives moving forward," said Ed Kim, director, TD Securities.
In operation for 40 years, Sabey Data Centers is one of the largest privately-owned multi-tenant data center operators in the United States. Sabey’s data centers provide wholesale data center services to many of the world’s top financial, technology, telecommunications and health care companies and position customers to combine key market locations with sustainable, low cost power.