Hut 8 secures second $9.8 billion AI data center lease at Beacon Point, bringing total contract value to $19.6 billion.
Hut 8 has secured a second 15-year lease valued at $9.8 billion for 352 megawatts of information technology capacity at its Beacon Point AI data center campus in Nueces County, Texas. The agreement fully commercializes the one-gigawatt campus and increases its total base-term contract value to $19.6 billion.
The unnamed high-investment-grade tenant, which also holds the lease for Beacon Point's first phase, has doubled its contracted IT capacity at the campus to 704 megawatts. Hut 8 will develop the second 352-megawatt phase as an AI factory based on NVIDIA's DSX reference architecture, supported by 500 megawatts of utility capacity.
The lease is structured as a triple-net agreement on substantially the same terms as the first phase, with the tenant assuming responsibility for property-related expenses including taxes, insurance, and maintenance in addition to rent. It includes a 3% annual base-rent increase over the initial 15-year term. Hut 8 expects the second phase to generate cumulative net operating income of $9.8 billion, averaging approximately $655 million annually after stabilization. Across both phases, Beacon Point is projected to produce average annual net operating income of approximately $1.31 billion. Three five-year renewal options attached to each lease could increase the campus's total potential contract value to $50.2 billion if all options are exercised.
Initial delivery of the second phase's first data hall is expected in the second quarter of 2028. Site preparation is underway, and long-lead equipment has already been procured. Initial energization of the campus remains scheduled for the first quarter of 2027. The campus's full 1,000 megawatts of utility capacity is secured through an electric delivery service interconnection agreement with AEP Texas, and Hut 8 stated it will not require additional utility capacity to support the new lease.
Hut 8 initially underwrote Beacon Point based on its ability to provide power to American Bitcoin Corp., an affiliated customer, before repositioning the project around two long-term AI infrastructure leases with an investment-grade counterparty. The first phase included a redesign around NVIDIA's DSX architecture, which increased available IT capacity by 57% within the same land and utility footprint.
The development demonstrates Hut 8's power-first strategy, in which the company secures large-scale energy capacity before matching sites with computing customers. This approach is intended to preserve flexibility across AI, high-performance computing, and other energy-intensive markets. Following the second Beacon Point agreement, Hut 8 has 949 megawatts of contracted capacity across its AI data center portfolio, including 704 megawatts at Beacon Point and 245 megawatts at River Bend. The company's AI data center portfolio now has an aggregate base-term contract value of $26.6 billion with projected average annual net operating income exceeding $1.75 billion. All contracted capacity is leased to or financially supported by investment-grade counterparties, and Hut 8 plans to apply the Beacon Point model across its development pipeline.
"The real test of our power-first approach is what our partners are willing to commit against it," Hut 8 stated. "Our tenant at Beacon Point chose to double its footprint at the site, the strongest validation an asset can receive. We took this greenfield site from first lease to full commercialization in just months. That speaks to the quality of the sites we originate, the credibility of our delivery, and the long-term orientation of our partnerships. The opportunity ahead of us is to apply the same model across our development pipeline."