Sovereign Wealth and Public Pension Direct Investments in Data Centers Outpace Hotels in 2020
Posted on 09/24/2020
Cash-rich sovereign wealth funds and public pensions are feeling more comfortable directly investing in data centers versus hotels and resorts, according to SWFI data and research.
The chart below takes into account non-fund investments by SWFs and large public pensions into these industries. Transaction amounts under US$ 10 million were not included.
Direct Transactions by Sovereign Wealth Funds and Public Pensions – Data Centers vs. Hotels and Resorts
Source: SWFI.com, Closed dates. Type: Deal, New Security Issue, Open Market, Excluding Fund Commitments. Industries: Hotel and Resorts and Hotel and Resorts REITs. Industries: Data Center and Data Center REITs. Include only transactions above US$ 10,000,000. Transaction totals are in U.S. dollars. These transactions also exclude most fixed income investments.
In some parts of the United States, corporate travel is all but non-existent right now, due to COVID-19 lockdowns. This is deeply impacting the hospitality industry, which is scaring off sovereign fund and pension investors. For 2020 (still ongoing), the investor group of sovereign funds and pensions invested so far US$ 1.126 billion in data center (industry) versus US$ 362.29 million in hotel and resorts (industry). The switch in direct investments between these industries occurred in 2019, when the total was US$ 4.234 billion in data centers and US$ 2.7 billion in hotels and resorts.
