Jeff Law, CEO of Related Companies, announced the launch of Related Digital to invest in data center infrastructure, aiming to raise $9 billion to meet the growing demands of AI, while committing $500 million of their own capital. He emphasized the strong and steady demand for data centers, driven by major tech firms, and highlighted the company’s strategy of securing long-term leases and leveraging their expertise in power procurement to capitalize on this market opportunity.
In a recent interview, Jeff Law, CEO of Related Companies, discussed the company’s significant expansion into data center investments through the launch of Related Digital. This initiative aims to develop infrastructure to meet the growing demands of artificial intelligence (AI). Law highlighted the company’s confidence in investing $500 million of its own capital and raising an additional $8 billion, despite concerns about potential overcapacity in the market.
Law provided background on Related Companies’ journey into renewable energy over the past five years, where they have been building solar, wind, and transmission projects. The company has seen increasing interest from major tech firms, particularly hyperscalers like Google, who are looking to purchase large quantities of power. This demand has prompted Related to pivot towards data center development, as they recognize the need for robust infrastructure to support these tech giants.
The CEO emphasized that there is currently no sign of diminishing demand for data centers. He pointed to significant capital expenditure announcements from major players like Microsoft and Alphabet, which indicate a strong commitment to expanding their operations. Law expressed confidence that the demand for data centers will remain steady in the short to mid-term, as these companies continue to invest heavily in their infrastructure.
Law also discussed the importance of securing long-term leases with hyperscalers before commencing construction on data centers. He noted that Related Companies is focused on obtaining 15-year commitments from these clients, ensuring a stable revenue stream. The company has already begun construction on a data center in Toronto and has several power-ready sites across the United States, indicating a proactive approach to meeting anticipated demand.
Finally, Law highlighted Related’s competitive advantage in securing a development pipeline of over five gigawatts of near-term power. He explained that while demand for data centers is high, the supply of power is constrained, making it a unique market. By leveraging their expertise in utility connections and power procurement, Related Companies believes they have positioned themselves favorably to capitalize on the ongoing demand for data center infrastructure in the coming years.