News
The day at a glance · 3 min read
Mood · Risk-On
+62
Sentiment, −100 to +100
DLR Share Price
$184.65+2.66%
South Africa DC CAGR
12.09%2025-2031
KIX15 Capacity
24 MW
Key driverAI infrastructure buildout drives data center REIT development activity and colocation demand across international markets
Daily briefReal Estate· Money365.Market AI ·

Data Center REITs Lead as AI Demand Drives Global Expansion

Digital Realty and Equinix advance on new construction and colocation deals; VICI yields 8% at depressed valuation

Digital Infrastructure

Bullish

AMT Operating Margin

45.41%
DLREQIXAMT
Digital Realty Trust (DLR) announced commencement of construction on KIX15, a 24 megawatt data center at its KIX Campus in Ibaraki City, Osaka Prefecture, Japan, designed for high-density computing and advanced cooling. The facility expands the company's Osaka campus footprint to support AI infrastructure demand. Digital Realty shares closed at $184.65 with a 2.66% one-day gain and 4.58% seven-day return, though the 30-day performance declined 1.99% against a 19.11% year-to-date gain.
Equinix (EQIX) benefits from broader market dynamics as the South Africa data center colocation market is projected to grow at a CAGR of 12.09% from 2025 to 2031, supported by cloud adoption and artificial intelligence demand. The growth forecast highlights wholesale colocation opportunities and AI-driven cooling technologies across emerging markets. Digital Realty also secured a deal with Blackfuel for its Barcelona BCN1 facility to house a liquid-cooled AI inference platform built on Dell and AMD hardware.
American Tower Corporation (AMT) traded at $164.78, gaining 1.55%, though the stock remains within five dollars of its 52-week low of $160.06. The communications tower REIT maintains a 45.41% operating profit margin on revenue from wireless carrier leases, yet valuation concerns persist despite the profitability profile.

Commercial & Industrial REITs

Neutral

PLD Share Price

$129+10.44%

PLD Operating Margin

43.03%

O Occupancy

98.8%

O Investment Activity

$2.6B

VICI Share Price

$22.73-19.25% YTD

VICI Dividend Yield

8%+
PLDOVICI
Prologis (PLD) traded at around $129 on October 6, up 1.05% on the day and 10.44% higher over twelve months, maintaining a 43.03% operating profit margin from warehouses leased to retailers and logistics operators. The industrial REIT faces scrutiny over its data center exposure amid broader skepticism toward AI-related technology investments. Power capacity uncertainty emerged as a constraint after Skybox Datacenters secured rezoning for a 140-acre Hutto site but may not learn its power allocation until 2028 due to Texas grid constraints.
Realty Income (O) reported 98.8% occupancy across its portfolio with $2.6 billion in recent investment activity, demonstrating tenant retention strength. The net lease REIT yields approximately 6% and benefits from contractual rent escalations across its diversified tenant base. Portfolio stability supports the company's monthly dividend distribution model.
VICI Properties (VICI) agreed to restructure its lease mix by spinning Century Mile and Century Downs in Alberta into a new triple net lease with Highfield while adjusting the Century Casinos master agreement to keep total rent unchanged. VICI shares closed at $22.73 with the year-to-date return down 19.25% and one-year total shareholder return down 23.96%. The gaming and hospitality REIT yields over 8% and trades at approximately 83% of equity creation cost, offering contractual seniority in its lease structures.

Looking Ahead

Neutral
SPGARE
Simon Property Group (SPG) announced details for its third quarter 2026 earnings release and conference call, providing the retail REIT sector with a forthcoming datapoint on mall performance and consumer spending trends.
Alexandria Real Estate Equities (ARE) is expected to announce third-quarter earnings in October, with Wall Street projecting a double-digit percentage decline in EPS year-over-year. Rising construction costs and elevated interest rates are increasing the value of existing data center capacity, opening capital recycling opportunities for operators with established facilities as new development economics remain challenged.

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