AirTrunk Secures A$4.25 Billion Green Loan for SYD3 Data Centre in Western Sydney
Blackstone-backed hyperscale data centre operator AirTrunk has secured an A$4.25 billion ($3 billion) green loan to fund its 400 megawatt SYD3 campus in Western Sydney. The facility, led by Sumitomo Mitsui Banking, HSBC and United Overseas Bank, involves 32 financial institutions and will finance AI
Blackstone-backed hyperscale data centre operator AirTrunk has secured an A$4.25 billion ($3 billion) green loan to fund development of its 400 megawatt SYD3 campus in Western Sydney, bringing the company's total committed debt financing to about $26.9 billion. The facility was led by Sumitomo Mitsui Banking, HSBC and United Overseas Bank as global coordinators, and backed by a consortium of 32 local and international financial institutions, according to a statement released on Tuesday by Sydney-based AirTrunk. The proceeds will be used to add infrastructure for artificial intelligence and cloud services at the campus in Huntingwood, about 30 kilometres west of central Sydney.
The loan for SYD3 is about 27 per cent larger than the financing AirTrunk secured for its JHB2 facility in Malaysia's Johor state, which the company described in a July announcement as its largest single-asset deal to date. Fourteen lead banks underwrote the loan: Banco Santander, BNP Paribas, Crédit Agricole, DBS Bank, Deutsche Bank, ING Bank, Mizuho Bank, MUFG Bank, National Australia Bank, Royal Bank of Canada, Société Générale, Sumitomo Mitsui, HSBC and United Overseas Bank. Mallesons advised AirTrunk and Gilbert & Tobin acted for the lenders.
The deal brings AirTrunk's total committed debt financing across its Australian projects to more than A$19.8 billion. The company's Australian platform spans five campuses, with more than 1.2 gigawatts of capacity. AirTrunk said it has invested more than A$12 billion in Australia, and plans to invest a further A$75 billion over the next decade. AirTrunk chief executive Robin Khuda said the debt deal signalled “a flight to quality in an increasingly selective capital market” and said “experience, disciplined execution, strong fundamentals and trusted relationships matter more than ever”.
The announcement comes during a turbulent month for the data centre sector, with AI cloud operator Firmus withdrawing a planned IPO that would have raised about $5 billion, AirTrunk itself putting its Singapore REIT listing on hold, and NextDC losing more than 40 per cent of its market value in a day after power delays in Melbourne. Firmus's withdrawal came after its IPO sought a valuation of about $31 billion, nearly three times the level set in an August funding round. NextDC's sell-off followed a guidance cut after network operator Jemena suspended parts of the grid upgrade works needed for its M3 data centre in Melbourne because of community opposition.
The green loan extends a run of bank financing since Blackstone and CPP Investments agreed to buy AirTrunk in 2024 in a deal valuing the company at A$24 billion. This month AirTrunk secured a $1 billion green loan for liquid-cooled capacity at its TOK1 Tokyo campus, following a JPY 191.6 billion ($1.2 billion) loan for the same project in March, taking bank debt arranged for the campus this year to $2.2 billion. In July, a 30-lender syndicate provided $2.325 billion for the JHB2 campus in Johor Bahru. AirTrunk had been working towards a Singapore REIT IPO, which was expected to raise about $1.5 billion at a valuation of around $15 billion, and in September was said to be in talks to borrow $1.6 billion ahead of the listing. AirTrunk had weighed lifting the REIT's offered yield to about 6 per cent from 5.5 per cent before deferring the listing to next year.
The facility carries margin adjustments tied to its green status, with any savings to be channelled into AirTrunk's social impact programme. AirTrunk did not disclose the loan's tenor, pricing or sustainability performance targets. The company's loan announcement said the SYD3 project is expected to support more than 10,000 jobs and add to its social impact program, which supports local charities working across STEM education, conservation, sustainable innovation, and disaster relief.
