TORONTO — Summit Industrial Income REIT has announced it is extending a $16-million mezzanine loan to its partner Urbacon Montreal Limited Partnership to develop a new 95,000-square-foot data centre property (DC2) on land owned by Urbacon directly adjacent to the existing data centre (DC1) in Richmond Hill, Ont.
Summit owns a 50 per cent interest in DC1, located in the Barker Business Park Digital Campus, in partnership with Urbacon.
Summit’s mezzanine loan can be converted into a 50 per cent ownership interest in DC2 once the property is leased and stabilized, said a Sept. 17 statement.
DC2 will be a 10-megawatt powered shell with scheduled completion in six months.
Urbacon has already commenced construction on the site.
The DC1 data centre is a purpose-built 10-megawatt data centre designated as Tier IV, the highest standard within the industry.
“With the DC1 property now fully leased to a major global cloud provider under a long-term lease, we are being proactive to develop new data centre capacity to serve the increasing demand in the sector,” commented Paul Dykeman, Summit CEO, in the statement.
“Looking ahead, we expect to generate higher returns on this investment than our industrial property developments, and a similar yield on cost as with DC1 once the building is fully stabilized.”