BlackRock has initiated a $12.3 billion bond offering aimed at financing a new Meta data center in El Paso, Texas. The bonds come through BlackRock's holding company, Sopaipilla Investor, featuring notes due in 2048 and priced around 2.875 percentage points above Treasuries.
The El Paso facility is designed to provide up to 1 gigawatt of computing power dedicated solely to AI workloads, signaling a massive infrastructure commitment. BlackRock subsidiaries collectively own 80% of the venture, while Meta holds the remaining 20% stake.
JPMorgan Chase and Morgan Stanley are managing the transaction, which is expected to finalize next week. BlackRock’s stock rose nearly 0.9% during the announcement, with Meta’s shares also nudging upward slightly.
This bond sale is notable for its high-grade rating, suggesting lower risk and more favorable borrowing costs. It also tests investor appetite amid growing questions about the scale of AI infrastructure investments, especially following Alphabet's recent $205 billion spending plan announcement that unsettled markets.
The structure of issuing debt through a holding company like Sopaipilla Investor allows BlackRock to keep liabilities off the main corporate balance sheet while tying financing directly to the project's assets. Meta’s minority ownership enables it to access the data center capacity without bearing the entire capital expense.
El Paso continues to attract data center projects due to its ample land, reliable power supply, and supportive regulations. Locking in bonds maturing in 2048 shows investors are taking a long-term view on demand for AI infrastructure, appealing to institutional investors like pension funds and insurers who seek investment-grade securities.
This development joins other significant moves in AI and infrastructure funding, highlighting sustained confidence in the sector’s growth prospects.
