A data center project tied to Meta Platforms (META) is seeking about $3 billion in loans for a new campus in Ohio. However, the deal stands out for its structure, which combines funding for both the data center and its power source into a single package.
Claim 30% Off TipRanks
- Unlock hedge fund-level data and powerful investing tools for smarter, sharper decisions
- Discover top-performing stock ideas and upgrade to a portfolio of market leaders with Smart Investor Picks
The project, known as Project Walleye, is designed to run on its own power system using natural gas. This setup allows the site to operate without relying on the local power grid in its early years. In short, the data center will generate its own electricity on site, which helps avoid delays tied to grid access.
At the same time, this approach adds complexity. As one person familiar with the deal said, “It’s more complicated,” noting that lenders must assess two different types of assets at once. Another investor added that the project “needs to pay more to compensate for the project-on-project risks.”
Meanwhile, META shares dropped 0.82% on Friday, closing the week at $574.46.
Why Big Tech Is Moving Off the Grid
Across the sector, large tech firms are facing limits in power access due to rising demand for AI. As a result, companies are turning to what is known as behind-the-meter power, where energy is produced directly at the site.
For Project Walleye, this means running in what insiders call “island mode,” where the campus operates independently from the grid. Over time, the site may connect to the grid if capacity becomes available.
Meanwhile, similar moves are underway across the industry. Alphabet (GOOGL) is backing a data center in Texas that will also use on-site gas power for operations tied to Anthropic.
Despite the added risk, investor interest remains solid. The project is being developed by EdgeConneX, owned by the private equity firm EQT, and has worked with clients such as Nvidia (NVDA), Google, and Oracle (ORCL). Some investors said they are comfortable with the company’s track record and ability to deliver large projects.
The loan package is being offered at about 2.5% above the base rate, which is slightly higher than other data center deals. Still, the project is expected to receive an investment-grade rating due to its lease agreement with Meta, which could help attract a wider range of buyers.
Overall, the deal reflects a shift in how data centers are built and financed, as AI demand pushes companies to secure both computing space and power simultaneously.
We used TipRanks’ Comparison Tool to align notable companies mentioned in the piece, which operate large AI data centers. It’s a great tool to gain an in-depth view of each stock and the broader AI industry.
