CyrusOne Inc. (NASDAQ: CONE), a premier global data center REIT, announced today it has entered into a definitive agreement with DataBank Holdings Ltd. (“DataBank”) for the sale of its four Houston data center assets. Under the terms of the agreement, DataBank will acquire the Houston West I, II and III and Houston Galleria data centers from CyrusOne. Additionally, CyrusOne will lease back from DataBank the Houston West III shell to support a lease signed with a hyperscale customer in the fourth quarter of 2021.
Total consideration for the transaction will be approximately $670 million, subject to a net working capital adjustment, with proceeds from the sale used to fund future development projects. The third quarter 2021 annualized run-rate cash NOI represented by these properties, including the future first year lease payments that will be made by CyrusOne, aggregate $34.8 million, implying a transaction cap rate of 5.19%.
“We are excited to execute on our capital recycling initiative to fund our continued growth,” said David Ferdman, Interim President & Chief Executive Officer. “This divestiture further optimizes our portfolio as we redeploy capital into accretive developments across core markets with diverse hyperscale and enterprise demand in the U.S. and Europe. We are pleased to partner with the DataBank team on this important transaction for our respective companies.”
The divestiture is expected to close by the end of the first quarter of 2022, subject to customary closing conditions.
DH Capital, LLC and DLA Piper LLP served as CyrusOne’s exclusive financial and legal advisors, respectively, on the transaction.
CyrusOne (NASDAQ: CONE) is a premier global REIT specializing in design, construction and operation of more than 50 high-performance data centers worldwide. The company provides mission-critical facilities that ensure the continued operation of IT infrastructure for approximately 1,000 customers, including approximately 200 Fortune 1000 companies.
A leader in hybrid-cloud and multi-cloud deployments, CyrusOne offers colocation, hyperscale, and build-to-suit environments that help customers enhance the strategic connection of their essential data infrastructure and supporting achievement of sustainability goals. CyrusOne data centers offer world-class flexibility, enabling clients to modernize, simplify, and rapidly respond to changing demand. Combining exceptional financial strength with a broad global footprint, CyrusOne provides customers with long-term stability and strategic advantage at scale.
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