Digital Realty stock falls; $3.5 billion stake in Blackstone data centers
A Digital Realty data center in Sterling, Virginia, US, on Sunday, May 31, 2026.
Lexi Critchett | Bloomberg | Getty Images
Digital Realty fell in premarket trading after it announced its buying a $3.5 billion stake in three data centers from asset manager Blackstone.
The Austin-based global data center firm said on Monday that it will pay $1.2 billion in cash and $2.3 billion in shares for data centers in Northern Virginia, valued at $7.8 billion. The transaction is expected to be completed on Tuesday.
Digital Realty will purchase Blackstone’s 80% interest in two 96-megawatt data centers in Manassas, Virginia, and a 50% interest in one 96-megawatt data center in Sterling, Virginia.
It was last trading down 5.4% before the market opened. The stock is up 23% in the year-to-date.
Digital Realty shares over the past year.
The first two data centers are expected to stabilize in the first half of 2027, and the third by the first half of 2028.
The transaction reflects the next phase of Digital Realty’s partnership with Blackstone, said Digital Realty’s chief investment officer, Greg Wright.
It allows the company to increase its ownership in a portfolio of “fully leased, high-quality hyperscale assets” that extends its runway for growth and pipeline of product for the continued expansion of its strategic private capital platform, he added in the Monday statement.
Digital Realty is looking to increase its exposure to the sector in Virginia, which has long been considered the world’s largest data center market.
Texas was close to beating Virginia’s reign in the data center space, a February report from real estate firm JLL found.
Additionally, 92% of the data center capacity in North America currently under construction is pre-committed, signalling vacancy is likely to remain low at least till 2030, per JLL.
The spending is driven by major hyperscalers, including Amazon, Microsoft, Meta, and Google, who have committed close to a total of $700 billion in capex this year for their AI infrastructure buildout.
Meanwhile, big tech is increasingly relying on private equity, private credit, and debt to finance these developments, with deals consistently reaching above $10 billion last year, according to data from Preqin, and as a result.