How I Underwrote a $70M Data Centre Park in Australia

I underwrote a $70M data centre park in Australia.

One tenant is already paying $1.6M/yr...

This is a large industrial site with grid infrastructure, being pitched as the base for a future data centre and energy hub. It's a very cool, unique project.

Grid connections like this take 10 years to get. This site already has one - a live 132kV substation, sitting on rail, ready to scale toward 350MW.

To fund deals like this, I ask 4 questions:

1) What stage of risk are we in?

- Pre-settlement, pre-offtake
- Site control only, not ownership
- Sponsor equity participation is at 8%

2) What makes the location work?

- Rare existing grid connection
- Rail spur on Sydney-Melbourne line
- New connections take 5-10 years

3) How is the downside protected?

- One tenant paying $1.6M/yr today
- Existing warehouse, heavy-floor building
- Sponsor liquidity is unresolved

4) Can we control the exit?

- No defined exit yet (likely a future sale)
- Interested buyers, but none signed
- $150M valuation floated, no deal behind it

I passed on this opportunity because the land wasn't owned and the sponsor barely had skin in the game.

There would be some Family Offices or Lenders who might take a risk, but I don't know any of them.

My verdict:

- Weak fit for Private Credit
- Medium fit for Family Offices
- Weak fit for Institutions

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