There is a report that QTS Data Centers (fully owned by Blackstone) is abandoning plans to build a data center in Virginia.
The market might be sensitive to these report in light of yesterday’s market-moving story about Meta looking to sell excess compute. There are fears of overbuilding and also that the huge spending won’t make an economic return.
Scotia yesterday wrote:
The bear framing is that a large
hyperscaler willing to sell excess compute, while still investing behind frontier models, signals
internal demand tracking below capacity, inviting an asterisk on future capex disclosures
across the group. The bull framing is CFO-driven arbitrage: with external GPU prices at current
levels, first-party allocation becomes harder to justify at the margin, and monetizing surplus
capacity is economically rational. We lean toward the latter but recognize the tension
I will try to track down the details of this report and the reason for the decision to shelve the project.
This article was written by Adam Button at investinglive.com.