CEO Who Just Sold His Data Center Firm to SoftBank for $4 Billion Is Warning of a Late 1990s Moment
Marc Ganzi, CEO of DigitalBridge Group, has expressed concerns about the AI infrastructure market, likening it to the late 1990s tech boom. DigitalBridge, which was recently sold to SoftBank for $4 billion, operates at a lower leverage ratio compared to newer data center rivals. Ganzi highlighted that while his company maintains a 45% loan-to-value ratio, others are pushing towards 70-80%.
He warned that the market is currently experiencing a similar riskiness to that period. The financing structure around NVIDIA's chip-financing initiative has been criticized as "priced to perfection," as every assumption in the structure must hold for it to succeed. Ganzi emphasized that a well-leased, investment-grade campus with a moderate debt structure has a customer and steady rent, while a first-time developer borrowing a significant portion of the project's value on behalf of an unrated operator faces higher risks.
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