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SAN FRANCISCO - Data center solutions provider Flexential has raised approximately $1 billion in capital investment to accelerate the development of next-generation data centers across the United States, according to a press release issued Wednesday.
The funding comes from a combination of investments, including a single-asset continuation vehicle anchored by funds managed by Hamilton Lane (NASDAQ:HLNE), a $8.47 billion market cap investment firm with strong financial metrics according to InvestingPro data, and an investment from GI Data Infrastructure. These investments, along with a previous commitment from funds managed by Morgan Stanley Infrastructure Partners that closed in November 2024, will support Flexential’s expansion plans. InvestingPro analysis indicates Hamilton Lane is currently trading near its Fair Value, with 5 analysts recently revising earnings estimates upward.
"This transaction strengthens our ability to deliver long-term infrastructure projects and secures the capital needed to keep pace with surging demand for AI and enterprise computing," said Chris Downie, CEO of Flexential.
The company plans to use the funds to develop high-density colocation facilities in response to increasing demand from enterprise and artificial intelligence customers. According to Flexential’s 2025 State of AI Infrastructure Report, 44% of organizations consider infrastructure the biggest barrier to AI adoption.
The capital infusion comes at a time when the data center market is experiencing record low vacancy rates in primary markets, rising prices, and power constraints that are extending lead times for new deployments.
"This capital enables us to accelerate site acquisition, guarantee power commitments, and bring projects online more quickly," said Ryan Mallory, President and COO of Flexential.
GI Partners, a private investment firm that has raised more than $47 billion since its founding in 2001, led the transaction. As part of the deal, Mark Prybutok, Managing Director and Head of GI Data Infrastructure, has been appointed to Flexential’s Board of Directors.
Flexential currently operates more than 40 data centers across 18 markets in the United States. For detailed analysis of Hamilton Lane and other key players in the investment management sector, including comprehensive financial health scores and exclusive insights, visit InvestingPro, where you’ll find in-depth Pro Research Reports covering 1,400+ top US stocks.
In other recent news, Hamilton Lane Inc. reported its first-quarter earnings for fiscal year 2026, significantly exceeding Wall Street expectations. The company achieved a non-GAAP EPS of $1.31, surpassing the forecasted $0.96, and reported revenue of $175.96 million, which was above the anticipated $164.5 million. Additionally, Keefe, Bruyette & Woods increased its price target for Hamilton Lane to $168 from $160, following the company’s impressive fiscal first-quarter results. This adjustment was attributed to higher fee-related performance fees, driven by strong evergreen fund performance.
In another development, PennantPark Floating Rate Capital Ltd. announced the formation of a $500 million joint venture with Hamilton Lane. The venture, named PennantPark Senior Secured Loan Fund II, LLC, will focus on middle market loans. Both companies have committed a total of $200 million in combined notes and equity, with PennantPark contributing $150 million and Hamilton Lane providing $50 million. These recent developments highlight significant financial and strategic activities for both Hamilton Lane and PennantPark.
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