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American Tower's CoreSite Acquires Denver Gas & Electric Building

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American Tower’s (AMT - Free Report) CoreSite recently acquired network-rich asset, Denver Gas and Electric Building and its related operating businesses to further expand its Denver market presence.

This #1 network-dense carrier hotel, located at 910 15th Street in the heart of downtown Denver, currently hosts CoreSite’s DE1 data center operations and serves as the primary point of interconnection in the Rocky Mountain region.

Through the acquisition of this hotel, the company aims to enhance its data center capacity by approximately 3 critical megawatts (CMW). This increase nearly doubles the space and power capacity of DE1, thereby strengthening CoreSite’s ability to cater to the growing demands of public and private cloud providers, enterprises, and network and service providers.

The transaction will enable CoreSite to facilitate easier access for customers to the existing Google Cloud Platform dedicated interconnects onramp, as well as expand their network offerings at one of the leading peering exchanges in the Rocky Mountain region, CoreSite’s Any2Denver Exchange. CoreSite is also set to gain around 100 customers from the interconnection-rich building, further establishing itself as the preferred hub for performance-sensitive applications.

CoreSite empowers critical business and AI workloads that impact everyday life through interconnected data center solutions. CoreSite's data center campus in Denver includes DE1, which is housed in the Denver Gas and Electric Building, and DE2, located at 639 E. 18th Ave. in downtown Denver. The company is expanding its Denver campus with the construction of an enterprise-grade data center, DE3, located at 4900 N. Race Street. Upon its completion, DE3 will provide 97,000 square feet of space and 18 CMW.

CoreSite’s Management Commentary

Per Yvonne Ng, general manager and vice president of the Central Region at CoreSite, “CoreSite is excited to further invest and expand in our hometown market of Denver. We are planning additional investment in the historic Denver Gas and Electric Building to increase operational efficiency and offer our customers a reliable, highly interconnected environment that meets all their high-performance, high-density computing requirements.”

AMT: In a Snapshot

Such acquisition moves offer American Tower the opportunity to capitalize on the CoreSite's highly interconnected data center facilities and critical cloud on-ramps, and bank on the robust demand from enterprises, the cloud, network and IT service providers.

It may be noted that American Tower acquired CoreSite in December 2021 for a total consideration of $10.4 billion. Through the buyout, AMT added more than 20 data center facilities and related assets in eight U.S. markets to its portfolio.

Shares of this Zacks Rank #3 (Hold) company have gained 17.9% over the past three months against the industry’s decline of 0.6%.

 

Zacks Investment Research
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Stocks to Consider

Some better-ranked stocks from the broader REIT sector are Cousins Properties (CUZ - Free Report) and VICI Properties (VICI - Free Report) , each carrying a Zacks Rank of #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for CUZ 2025 FFO per share is pegged at $2.79, which indicates year-over-year growth of 3.7%.

The Zacks Consensus Estimate for VICI’s full-year FFO per share is $2.33, which indicates an increase of 3.1% from the year-ago period.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.


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