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NEWS ROUNDUP

JOINT VENTURE: Realty Income and Cloud Capital form $1.4B JV. Realty Income has formed a strategic joint venture with Cloud Capital, its affiliates and an unnamed global institutional investor to invest in stabilized hyperscale data centers across the U.S. and Europe. Realty Income expects to invest up to $1.4 billion over time, including approximately $700 million between the second and third quarters of 2026. Sumit Roy, President and CEO of Realty Income, said the venture aligns with the company's disciplined capital allocation strategy, while Hossein Fateh, Founder and CEO of Cloud Capital and CloudHQ, highlighted the need for capital and operating expertise to meet accelerating hyperscale infrastructure demand.

DEVELOPMENT: Microsoft opens Wisconsin data center. Microsoft has completed and opened its Fairwater AI data center in Mount Pleasant, Wisconsin, ahead of schedule. Brad Smith, Vice Chair and President of Microsoft, said the facility will support the next generation of global AI innovation while creating long-term economic opportunities in Wisconsin. More than 90% of the facility's infrastructure uses a closed-loop liquid cooling system, supported by what Microsoft describes as the world's second-largest water-cooled chiller plant.

DEVELOPMENT: Empery Digital to invest $65 million in 300MW Midwest AI data center. Empery Digital has agreed to invest $65 million for a 25% stake in a private entity acquiring a Midwest industrial facility for conversion into an AI data center. The property currently has 150MW of available power through an existing utility agreement and an owned substation, while a recent load study indicated capacity could nearly double to 300MW to support AI workloads. Empery Digital has also formed a strategic partnership with Hunt Properties to identify, evaluate and acquire powered sites with secured tenants for AI and high-performance computing data center development. The investment is expected to close in the third quarter of 2026, subject to customary closing conditions.

FUNDRAISING: Starwood raises $10.2 billion opportunity fund. Starwood Capital Group has closed its Starwood Distressed Opportunity Fund XIII with $10.2 billion in commitments from more than 300 investors across roughly 20 countries, including pension funds, sovereign wealth funds, endowments, wealth managers and family offices. Barry Sternlicht, Founder and CEO of Starwood Capital, said as much as 35% of the fund could be allocated to data center investments. Jonathan Pollack, President of Starwood Capital, said slowing supply across traditional real estate sectors and rapid growth in technology and manufacturing are creating attractive investment opportunities.

READ: Boom in hyperscale data centers puts insurers to the test.

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