By Reuters

(Reuters) - Meta Platforms and the world's largest asset manager BlackRock on Tuesday announced a venture to develop and operate a data center campus ‌in El Paso, Texas, a project that would cost about $14 billion in ‌development.

The race to build out AI infrastructure has prompted tech giants to turn to debt sales worth tens ​of billions of dollars or seek external capital from fund managers such as BlackRock due to an unprecedented scale of investment.

Meta said BlackRock-managed funds will take an 80% ownership stake in the venture, with Meta retaining the remaining 20%. A portion of BlackRock's investment will ‌be financed through $12.5 billion in ⁠debt. Meta will also receive a $1 billion distribution to align ownership.

Meta will contribute land and in-progress construction assets worth about $2.3 billion, while ⁠BlackRock will make a cash contribution of about $4.9 billion, the company said.

The Facebook-parent earlier said it was building an over $10 billion data center project in El Paso, near the Texas-New Mexico ​border, among ​28 data centers it has in either ​operation or under construction in the ‌U.S.

The data center campus, already under construction, is designed to provide 1 gigawatt of compute capacity, essential for Meta's AI technologies and supporting its core business. Operations are expected to commence in 2028.

Meta has said it plans to invest $600 billion to build data centers by 2028, with an aim to fast-track work on personal superintelligence, which could help ‌spin up new cash flows from the Meta ​AI app, image-to-video ad tools and smart glasses.

• 

  Predict and win massively with the world largest prediction markets. Join traders who have earned over $10,000,000 in cashout.

  
  
  Polymarket Ad

The social ​media giant is building several ​gigawatt-scale data centers across the U.S., including one in rural Louisiana, a ‌project Meta expected to expand to ​5 gigawatts of compute ​capacity, with investment increasing to more than $50 billion.

Shares of Meta had fallen about 10% so far this year, as investors are scrutinizing costs of AI expansion. ​The company is scheduled to ‌report second-quarter results on July 29.

Morgan Stanley & Co and J.P. Morgan Securities served ​as financial advisors to Meta in connection with this transaction.

(Reporting by Jaspreet ​Singh in Bengaluru; Editing by Devika Syamnath)

This week on Reuters

• Growing number of brokerages see July Fed decision as 'a close call'

• How investors buy gold and what fuels the market

• Brazil says 16.5% of exports face combined US duties of 37.5%

• Investors fret that spiking oil prices and rising yields could threaten stock rally