BlackRock, Global Infrastructure Partners, Microsoft, MGX launch AI partnership
Summary
- The partnership, called the Global AI Infrastructure Investment Partnership, will additionally build out energy infrastructure to create power sources for the facilities, the companies said.
BlackRock , Microsoft and United Arab Emirates state-backed investor MGX are partnering on a new artificial-intelligence infrastructure fund that aims to raise $30 billion to invest in data centers and related power infrastructure.
After raising the private-equity capital from investors, the partnership could deploy up to $100 billion in total capital when including debt financing, the parties said Tuesday. Most of the infrastructure investments will be made in the U.S.
The systems powering new AI products are highly energy intensive. The recent frenzy to build data centers to serve the exploding demand for AI is causing a shortage of the parts, property and power that the sprawling warehouses of supercomputers require.
Microsoft and other big tech players have been investing billions in their own data centers. The new partnership—dubbed the Global AI Infrastructure Investment Partnership—will pool capital from investors like pension funds and insurance companies that seek steady, modest returns from private infrastructure investments.
It will finance projects across the AI infrastructure ecosystem, including energy infrastructure. By 2030, data centers alone could increase U.S. power demand by 8% , researchers say.
The goal is to finance some of the capital intensive infrastructure needs with money from outside the tech sector, BlackRock Chief Executive Larry Fink said in an interview.
“We’re providing the vehicle in which the AI hyper-scalers can use their capital elsewhere and we have the pension funds and insurance companies invest in the infrastructure and enjoy the long-term returns that are perfect for their retirement plans," Fink said.
Microsoft is investing in the fund, though the companies declined to reveal how much. The partnership will provide full-access on a nonexclusive basis to a range of companies that want to lease data centers and other infrastructure.
“We see artificial intelligence as a fundamental driver of economic growth for the country," Brad Smith , vice chair and president of Microsoft, said in an interview. “And all of this needs to be built out in order for the country to expand."
If it reaches its goal, the fund would be the biggest alternative investment fund ever raised by BlackRock. The world’s largest asset manager has been pushing into the more lucrative world of managing private investments over the past few years. BlackRock spent $12.5 billion to acquire alternative investment firm Global Infrastructure Partners earlier this year, which will also be a partner in the new fund.
BlackRock estimates that trillions of dollars are needed to finance the growth of data centers and energy resources long term.
—Miriam Gottfried and Tom Dotan contributed to this article.
Write to Jack Pitcher at jack.pitcher@wsj.com and Connor Hart at Connor.Hart@wsj.com
