Data Center Securitizations: Global Methodology And Assumptions

This article presents S&P Global Ratings' global criteria framework for rating data center securitizations. We use these criteria to analyze data center securitizations (see Appendix 1 for further details on scope). Data center securitizations are transactions backed by income generated from data center operations. When the issuer owns the related properties, the transactions also benefit from the proceeds arising from their sale. In general, we analyze both the recurring lease income and proceeds related to property sales. For issuers that don't own the data centers or corresponding land, only the recurring revenue streams are analyzed because noteholders have no recourse to the physical assets; instead, issuers are assigned both real estate leases and tenant contracts.

For each transaction, we analyze exposure to events that could interrupt or reduce the expected cash flow, including factors that could impede finding new tenants or selling properties.