Blackstone's Majority Stake in Three Virginia Data Centers
PE-OWNED
Acquired by Digital Realty
What PE Will Likely Do
Deferred cooling system upgrades leading to higher operating temperatures and increased server downtime risk
Reduced on-site engineering staff resulting in slower incident response times for colocation customers
Aggressive power and cross-connect pricing increases at lease renewal (15-30% typical in PE-owned data centers)
Delayed generator and UPS maintenance increasing risk of extended outages during utility failures
Reduced physical security staffing and delayed access control system updates
Expected Timeline
“0 to 6 months months”
Announcements about 'optimizing operations' and 'enhancing efficiency' while existing lease terms remain stable; quiet staff reductions through attrition
“6 to 12 months months”
First noticeable service degradation: slower ticket response times, reduced on-site presence, 'efficiency' pricing for new contracts 20-40% above legacy rates
“12 to 24 months months”
Deferred maintenance becomes visible: aging cooling infrastructure struggles in summer months, more frequent 'planned maintenance' windows, key technical staff departures
“24 to 48 months months”
Significant lease renewal pressure with above-market rate increases; major facility systems (generators, chillers) approach end-of-rated-life without replacement planning
Similar Cases
Other companies that followed a similar path after PE acquisition
What You Can Do
Actions
Negotiate maximum lease term with rate caps NOW before PE operational changes take effect
Document current SLA performance metrics (ticket response times, uptime, on-site response) to establish baseline for future disputes
Require contractual commitments to specific maintenance schedules for critical infrastructure (generators, UPS, cooling)
Negotiate early termination rights with reasonable exit fees in case service degradation becomes unacceptable
Maintain current network architecture documentation to reduce future migration costs if relocation becomes necessary
Alternatives
Look for family-owned or employee-owned businesses