Information on the Target

The Quetta Data Centers platform will be managed by Azora and advised by Core Capital, a firm renowned for its successful track record in the data center sector. Quetta is set to invest over €500 million in the construction and management of six 'Edge' data centers strategically located in Spain and Portugal.

This project aims to establish the first eco-efficient network of data centers in Iberia, employing 100% renewable energy and achieving a Power Usage Effectiveness (PUE) rating of less than 1.15. These Edge data centers are specifically designed to offer technological solutions for companies that require low latency in data processing, catering to the needs of businesses with high data traffic demands.

Industry Overview in the Target's Specific Country

The data center industry in Iberia is experiencing significant growth, driven by increased demand for data storage and processing capabilities. The proliferation of digital technologies, coupled with the expansion of cloud services, has created a robust market for data centers, particularly in urban areas where proximity to end consumers is crucial.

Spain and Portugal boast favorable geolocation attributes and access to renewable energy sources, making them attractive locations for data center investments. With an uptick in the consumption of data due to advancements in augmented reality, gaming, and IoT, the demand for Edge data centers is expected to rise.

Additionally, the region benefits from extensive communication infrastructure, including intercontinental submarine cables, which facilitate efficient data transmission. As businesses increasingly seek low-latency solutions, the industry is poised for accelerated growth.

Sustainable practices are gaining traction within the sector, with stakeholders focusing on eco-efficient data center designs. This shift toward sustainability aligns with global efforts to reduce carbon footprints, enhancing the appeal of investments in this asset class.

The Rationale Behind the Deal

This investment represents Azora's inaugural venture into the Iberian data center market. The decision stems from the firm’s strong conviction regarding the anticipated surge in demand for data center services, fueled by both structural market trends and the accelerated adoption of digital technologies across various sectors.

The placement of the six Edge data centers in major urban centers like Madrid, Barcelona, and Lisbon allows Quetta to capitalize on the unique advantages of the Iberian Peninsula, ensuring efficient service delivery to local clients while adhering to high energy efficiency standards.

Information About the Investor

Azora is a well-established investment management firm specializing in sustainable infrastructure projects. With a focus on creating long-term value, the company leverages its extensive expertise in local real estate markets and operationally intensive asset management.

The collaboration with Core Capital, led by founding partner Paco González, further strengthens Azora's capabilities in the data center sector. Core Capital's strategic insights and market connections complement Azora's investment objectives, ensuring a comprehensive approach to developing and operating data centers that meet the evolving needs of their clients.

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The launch of Quetta Data Centers is strategically aligned with burgeoning trends in the digital economy. By investing in an eco-efficient network of Edge data centers, Azora positions itself well to benefit from the rapidly growing demand for low-latency data solutions, which are increasingly critical for sectors such as streaming content and gaming.

The focus on renewable energy and a PUE rating of less than 1.15 demonstrates a commitment to sustainability, which not only enhances the project’s marketability but also addresses rising environmental concerns. Additionally, the ability to provide interconnected geographical coverage suitable for demanding applications is a competitive advantage.

However, potential investors should remain cautious and consider the challenges of entering a competitive landscape where established players may have significant market share. Despite this, the combined experience of Azora and Core Capital suggests that the Quetta Data Centers could emerge as a strong contender in the market.

In summary, this investment represents both a timely entry into a growing sector and an opportunity to leverage Synergies through sustainable practices, making it a compelling venture for stakeholders interested in the future of digital infrastructure.

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