How Data Center Deals Are Structured: Shells, Build-to-Suits, Leases and JVs

A data center deal has three layers: the land, the building and its power and cooling systems, and the computing equipment inside. Each structure is a different answer to who pays for and owns each layer. A hyperscaler can own all three. More often today, a developer or investor owns the land and building, and the tenant signs a lease that underwrites the debt and equity behind it.²⁷

The labels overlap in practice. A build-to-suit can be delivered as a powered shell or as a finished facility, and a single campus can mix structures across phases. What matters is the line in the contract between what the owner builds and what the tenant installs.

At the light end, a landowner or land developer sells or leases powered land: a site with zoning in hand and a credible path to utility service. The buyer designs and builds everything on it. Land deals of this kind usually start with an option agreement or a ground lease, and the choice between them is covered in our guide to buying, optioning or leasing data center land.

A powered shell goes one step further. The landlord delivers the structure, utility power and connectivity, and the tenant installs the cooling, generators and IT systems. A law firm review of the model describes powered shell projects as defined by the boundary between base-building infrastructure and tenant fit-out, which is where most negotiation happens.¹

• Who builds the substation, and who owns it once energized.
• Whether the landlord or the tenant carries the utility’s collateral and construction charges.
• Which structural loads, floor heights and yard space the shell must accommodate for the tenant’s equipment.
• What the landlord must deliver, and by when, before rent starts.

Hyperscalers like powered shells because they keep control of the mechanical and electrical design, which changes quickly as rack densities rise. Developers like them because the capital at risk is smaller than for a finished facility.

In a build-to-suit, a developer builds a facility to one tenant’s specification under a lease signed before construction. Market data shows how dominant this pattern has become. CBRE reported 7,481 MW under construction across the eight primary North American markets in the first half of 2026, a record, with more than 80% of it preleased.³ Vacancy was 1.4%.³ Data center vacancy is usually counted in megawatts of available capacity rather than in square feet.

The Abilene, Texas campus behind the Stargate project shows the build-to-suit model at scale. A joint venture of Crusoe, Blue Owl Capital and Primary Digital Infrastructure was formed in 2024 to fund capacity at the site, described at the time as 100% long-term leased to a Fortune 100 hyperscale tenant.⁹ J.P. Morgan provided a $2.3 billion construction loan for the first 206 MW, leased to Oracle.¹⁰ Later reporting said Oracle signed a 15-year lease for a large part of the campus and that total capital raised for the project reached about $15 billion.¹¹

The sequence matters for land. The lease comes first, and the lease is what lenders finance. A site that cannot show a credible power date rarely gets to the lease stage, which is why energization timing sits at the center of these deals.

In a turnkey or wholesale lease, the operator delivers a finished, powered and cooled data hall and the tenant brings its servers. Smaller customers take colocation space by the cabinet or cage instead. Rating agency KBRA, reviewing wholesale hyperscale leases in 2026, found that most are net leases, with the variations reflecting how operating and capital cost responsibility is divided.²

KBRA notes that operational control and lifecycle capital spending are shifting to hyperscale tenants under absolute triple-net structures, which steadies near-term cash flow for the owner. It also stresses that power, not space, drives data center lease economics.² A companion KBRA report found that differences among triple-net, double-net and modified gross leases have widened the range of debt coverage that lenders expect.⁷

Lease commitments by the largest tenants are now very large. Microsoft disclosed $92.7 billion of mostly data center leases that had not yet commenced as of June 30, 2025, with start dates through fiscal 2031 and terms from 1 to 20 years.¹² A year later the figure was $329.1 billion as of June 30, 2026, with commencement dates from fiscal 2027 to 2033 and the same 1- to 20-year range of terms.¹³ Bloomberg Government reported that more than $130 billion of new data center leases had been added in a single quarter.¹⁴

A joint venture pairs an operator or tenant, which brings development skill or demand, with institutional investors that bring most of the equity. The partners share ownership of the facilities and usually raise debt against them. Our guide to who finances data centers covers the investors themselves.

• Equinix xScale (2024): GIC and CPP Investments each took 37.5% and Equinix 25% of a venture targeting more than $15 billion, including debt, to build U.S. hyperscale campuses of more than 100 MW each and over 1.5 GW in total.⁸
• Meta and Blue Owl, Hyperion (2025): Blue Owl funds own 80% and Meta 20% of a venture covering about $27 billion of development costs in Richland Parish, Louisiana. Blue Owl funds contributed about $7 billion in cash, and Meta received a one-time distribution of about $3 billion.⁴
• Crusoe, Blue Owl and Primary Digital, Abilene (2024): a developer-led venture funding a campus already leased to a single hyperscale tenant.⁹

The Hyperion venture shows how far the structure can bend. Meta leases the completed facilities from the venture under an initial four-year operating lease with options to extend, backed by a capped residual value commitment covering the first 16 years of operations. Part of the capital came from debt sold to PIMCO and other bond investors in a private offering.⁴ For the tenant, the result is a campus it controls without owning most of it.

In a sale-leaseback, the company that owns and occupies a data center sells it to an investor and signs a lease to stay. The seller converts real estate into cash. The buyer gets a leased asset with a known tenant. Data Center Frontier described the structure years ago as a way for investors to build portfolios from enterprise-owned facilities.⁵

The terms tend to be simpler than a new development lease because the building already exists. A 2025 JLL marketing listing for a 4.5 MW southeastern facility owned by a Fortune 50 company sought offers on a 10-year leaseback under a full-service gross structure, with adjacent land for power expansion.⁶ An industry commentary pointed to Yahoo’s 2025 sale-leaseback as an example of operators turning owned facilities into liquidity.¹⁵

The party that approaches a landowner may not be the party that ends up owning the campus. A land developer may resell entitled powered land, a powered shell developer may need a tenant before closing, and a joint venture may form only after the site is secured. Before signing, it helps to know which structure the buyer intends.

1. 01Ask who the end user is likely to be, and whether a lease or JV must be in place before the buyer closes.
2. 02Ask what the buyer needs from the land: zoning, a utility commitment, or a shell-ready pad.
3. 03Check how the letter of intent handles assignment to an affiliate, venture or future owner.
4. 04Understand how the buyer will underwrite the site, especially power timing, because the tenant lease depends on it.
5. 05Confirm structure, tax and title questions with an attorney before agreeing to a long-term commitment.

Whatever the structure, the deal rests on the same site facts: power, buildable land, water, fiber and entitlements. If you want an independent read on those before negotiating, you can get a site reviewed.