News & Events

Real Estate Partner Scott Kobak and Energy and Infrastructure Partner Gabriel Silva were featured in a Bloomberg Q&A titled, “Simpson Thacher Lawyers See No Slowdown in Private Equity’s Demand For Data Centers.” The article highlighted the rise of data centers and how this trend is expected to continue. Scott explained, “Data centers is probably the first sector where I don't hear a whisper of 'are people getting too optimistic?' There's so much confidence in the demand side of this that it's really the supply side that's the challenge. There are a lot of barriers to entry. Developing a new data center takes extreme expertise as well as large sums of capital.” When speaking to why there is such a focus on data centers now, Gabriel further noted that, “The No.1 driver of growth in data centers is the mass adoption of next generation technologies like AI and machine learning. These new technologies require materially more computing power than traditional workloads because of their high density computing. This results in demand for density and power being very high, but such technologies are less attached to top-tier locations and are pushing workloads and demand for power to tier-two and tier-three markets”.

To read the full Q&A, please click here (subscription may be required).