(Bloomberg) – The capital flow that is being directed to AI infrastructure is increasing the risks of excess capacity, as the world’s greatest investors seek to profit from the Boom of Artificial Intelligence, according to Kipp, the Ares Management Corp co -president.
“If you look historically to areas like this in the last 20 or 30 years, usually when so much capacity goes into operation, part of it, after all, is marginal,” he said, speaking, on the sidelines of the Greenwich Economic Forum in Connecticut on Tuesday. “These trends tend to lead to superdimensions in certain places, so being selective and measuring what we build is important.”
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Giants of alternative asset management, including Blackstone Inc., Brookfield, Apollo Global Management Inc. and Ares, invested in data centers projects as a way to profit from the growing demand for processing power triggered by the advent of artificial intelligence. Many present their investments as a more reliable way to take advantage of AI boom, avoiding the risk of a gold race in AI actions, as it is difficult to predict winners and losers.
Ares, based in Los Angeles, revealed last month more aggressive fundraising goals, especially for investments in data centers and their equity management business. The company said it intends to capture more than $ 8 billion in capital to support short -term date centers in London, Japan and Brazil. It also increased its capture target for the equity management business by US $ 25 billion to US $ 125 billion by 2028.
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Ares, which historically focuses on data centers financing through its credit business, raised US $ 2.4 billion in the first half of the year for these facilities and has a fund dedicated to digital infrastructure investments in Japan. Last year, it acquired the operations of Capital Partners Ltd. outside of China for up to $ 5.2 billion, a business that doubled the air estate assets and allowed the air and allowed to Company did more direct development of data centers, according to it.
“If you work in difficult markets – that is, with land with difficulties that are hard to find – and you are building high quality facilities, which we believe you are doing because we have an internal team that came with the acquisition, it is relatively easy for us to find great lease agreements with investment grade tenants, such as hyper climbers,” he said.
Ares’s strategy is focused mainly on pre-leocated enterprises with 15 years or older contracts, with so-called rental staggers, which, according to the company, reduce the long-term risk. Financing for these investments can be directed to the capital of insurers.
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The company also said it seeks to capture $ 70 billion for alternative credit by 2028. And expects the secondary market – usually sales with second -hand discount, including credit, private equity and infrastructure – more than doubles in the next five years.
The company bought $ 7 billion in sequel vehicles, which allow fund managers to transfer private participation to new funds.
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