Meta Platforms and BlackRock, the world's largest asset manager, announced a joint venture on Tuesday to develop and operate a massive $14 billion data center campus in El Paso, Texas — underscoring Wall Street's deepening role in financing the AI infrastructure boom.
The Deal
Under the terms of the agreement:
- Ownership: BlackRock-managed funds will take an 80% stake in the venture, with Meta retaining 20%. - Financing: A portion of BlackRock's investment will be financed through $12.5 billion in debt. - Meta's contribution: Meta will contribute land and in-progress construction assets worth about $2.3 billion. - BlackRock's cash: BlackRock will make a cash contribution of about $4.9 billion. - Meta's lease: Meta will enter into lease agreements with the venture to secure computing capacity, avoiding direct ownership of the campus. - Capacity: The campus is designed for 1 gigawatt of compute capacity, essential for Meta's AI technologies. - Timeline: Operations expected to commence in 2028. - Meta distribution: Meta will receive a $1 billion distribution to align ownership.
Why This Matters
The deal exemplifies a broader shift in AI infrastructure financing. With tech companies facing investor scrutiny over massive capital expenditures, partnerships with asset managers allow them to secure computing capacity without the full balance sheet impact.
AI-related bond issuance has reached $270 billion by early July this year — nearly double what was raised in all of 2025, according to BofA Global Research. The scale of borrowing has hit a "fever pitch" as companies race to build out AI capabilities.
Investor Skepticism
Meta shares have fallen about 10% this year as investors question the returns on AI spending. Unlike cloud hyperscalers such as Amazon AWS or Microsoft Azure, Meta doesn't have a large cloud business to sell spare capacity to external customers.
"The scale of spending still raises valid questions about cash flow, future operating costs, and investment returns," said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
Interestingly, media reports indicate Meta is in talks to lease computing power to Anthropic in a potential deal worth up to $10 billion over two years — a move that would generate some external revenue from its AI infrastructure.
Meta's AI Spending Spree
Meta has said it plans to invest $600 billion in AI infrastructure in the U.S. by 2028. The company is building several gigawatt-scale data centers across the country, including a project in rural Louisiana that could expand to 5 gigawatts with an investment of more than $50 billion.
Earlier this year, Meta appointed Dina Powell McCormick, a Trump ally, as president and vice chairman to drive partnerships with governments and investors for its AI projects.
The Broader Context
The El Paso campus is already under construction and represents a new model for AI infrastructure finance. Instead of tech giants bearing the entire capital burden, Wall Street is increasingly stepping in — a trend that analysts expect to accelerate as AI computing demands continue to grow exponentially.
