Data Center Leases: Variations on Established Themes

The data center industry continues to expand rapidly amid increasing demand for artificial intelligence (AI) compute capacity, cloud services, and the proliferation of data-intensive technologies. As the need for financing has also risen, data centers have become an increasingly popular asset type in the securitization market. Total new issuance volume in the space reached $27 billion in 2025 and is expected to continue increasing as the next wave of data centers currently under construction is completed and becomes eligible for takeout financing. Importantly, the vast majority of securitized issuance has been backed by wholesale hyperscale assets.

Against this backdrop of accelerating issuance, understanding how hyperscale data center leases are structured—and how they compare with traditional commercial real estate (CRE) leases—is increasingly important. This report examines the key structural features of wholesale hyperscale leases, highlighting similarities, differences, and the…