Meta and BlackRock announce $14 billion joint data center development partnership, combining hyperscaler operations with institutional capital deployment.
Meta Platforms and BlackRock, the world's largest asset manager, have partnered to develop and operate a massive data center campus in El Paso, Texas, valued at approximately $14 billion. The partnership underscores Wall Street's growing role as a major financial backer of AI infrastructure.
Under the agreement announced Tuesday, BlackRock-managed funds will hold an 80% stake in the venture, while Meta retains 20%. BlackRock will finance a portion of its investment through $12.3 billion in debt, while Meta will contribute land and construction assets valued at $2.3 billion. Meta will receive a $1 billion distribution to align ownership between the partners and will lease the entire campus under an initial four-year agreement with extension options.
The El Paso facility, already under construction, is designed to deliver 1 gigawatt of computing capacity and is expected to begin operations in 2028. The project will support Meta's AI systems and core business operations. This campus is one of 28 data centers Meta currently has in operation or under construction across the country.
"The joint venture with BlackRock allows us to move faster and at greater scale," Meta Chief Executive Officer Mark Zuckerberg said in a statement.
Meta recently increased its projected annual capital spending to between $125 billion and $145 billion, driven by AI infrastructure investments and component pricing. The company intends to invest over $600 billion in data center construction by 2028 as it pursues what it calls "personal superintelligence." In addition to the El Paso project, Meta is building several other gigawatt-scale facilities, including a Louisiana project featuring 5 gigawatts with an expected investment of $50 billion spanning nearly 10 million square feet—though that deal faces scrutiny on various fronts. Meta is also in talks to lease computing power to Anthropic for what could be worth $10 billion over two years.
Meta's stock has declined approximately 10% as investors weigh the costs associated with the company's AI expansion, a trend seen among major technology companies investing heavily in AI and data centers. The company is scheduled to release its Q2 financial report on July 29.
"The scale of spending still raises valid questions about cash flow, future operating costs, and investment returns, particularly as Meta doesn't currently have a large cloud business selling spare capacity to external customers," said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
The infrastructure investment boom extends beyond Meta. Nvidia will provide financial guarantees worth $250 billion to support OpenAI's plan to lease a 10-gigawatt AI data center project being built by SoftBank's energy division in Southern Ohio. Last week, Alphabet's shares fell 4% as earnings reports showed the company's planned AI spending. The rapid data center buildout has also spurred organized opposition, with 142 protests across 42 states coordinated by HumansFirst, which was co-founded by a former leader of the Tea Party movement.