Global investment management firm Cloud Capital has launched a core joint venture strategy with Realty Income and a global institutional investor, seeded with three initial investments valued at more than US$6 billion.

The strategy will focus on stabilised hyperscale data centre assets in the US, leased to investment-grade tenants under long-term triple-net leases. The platform also plans to expand into Europe.

The joint venture is designed to provide core exposure to data centre assets in tier-one markets with high barriers to entry.

Hossein Fateh, founder and CEO of Cloud Capital, said long-term tenant relationships and asset quality remain central to data centre investment. Fateh added that his experience across multiple market cycles has shown the importance of acquiring and developing large-scale data centre assets backed by durable leases. 

“We believe this positions our partners to benefit from exposure to highly strategic data centers underpinned by accelerating demand for cloud and AI applications.”

The launch builds on Cloud Capital’s track record across the data centre investment cycle and expands its range of strategies.

Cloud Capital focused on acquiring, managing, and operating data centres. Since 2020, the firm has acquired 30 data centre assets worldwide, valued at more than US$12 billion.

The Core JV follows the firm’s existing vehicles, including its core-plus open-end strategy, opportunistic closed-end strategy and recently launched value-add closed-end strategy.

Founded in 1969, Realty Income owns more than 15,500 properties across all 50 US states, the UK, and eight other European countries.

According to Realty Income president and CEO Sumit Roy, the joint venture extends the company’s investment model into digital infrastructure. He said Realty Income is also expanding its relationship with Cloud Capital, which is vertically integrated with data centre developer and operator CloudHQ.

Roy said the joint venture combines data centre assets leased to investment-grade tenants with long-duration triple-net leases.