BlackRock, Microsoft, Nvidia, Blackstone and the Future of Global AI Infrastructure Investment

An alliance between BlackRock, Microsoft, Global Infrastructure Partners (GIP) and MGX was announced in September 2024 with a goal of building the backbone of future AI infrastructure.

The new Global AI Infrastructure Investment Partnership (GAIIP) announced that it planned to raise $80 billion to $100 billion to build data centers and, perhaps more importantly, the supporting grid energy infrastructure to power them.

Starting in the United States, the alliance has clear ambitions to operate globally.

An initial $30 billion of private equity capital announced by GAIIP is planned to be raised by investors, corporations and asset owners, with a goal of enabling an increase to $100 billion, which can include debt financing.

Development plans include new energy plants and building new AI infrastructure, with an expectation that GAIIP will benefit from new policies that encourage private investment in the utility sector.

NVIDIA is on-board as an official technical advisor, with plans to design GAIIP’s infrastructure to integrate with NVIDIA’s AI factories and full-stack computing platforms so that performance can be maximized for AI and HPC workloads.

Unlocking Investment and Supporting Sustainability

It appears that the vision of GAIIP is to encourage both private investment and the power necessary to drive AI growth and encourage sustainable development.

In discussing goals of this partnership, Microsoft Chairman and CEO Satya Nadella remarked:

“We are committed to ensuring AI helps advance innovation and drives growth across every sector of the economy. The Global AI Infrastructure Investment Partnership will help us deliver on this vision, as we bring together financial and industry leaders to build the infrastructure of the future and power it in a sustainable way.”

The transnational partnership aims to create an AI that solves for climate change, rather than creates it. 

For instance, members of the alliance are pushing for the incorporation of AI-powered systems into an ecological transition to a green economy, through the construction and operation of data centers based on renewable energy and green technology.

An investment strategy this large devoted to infrastructure and innovation will create – or is intended to create – an opportunity to set the stage for the economic growth and job-creation plans for the U.S.

Larry Fink, Chairman and CEO of BlackRock, described the described his view: 

“Mobilizing private capital to build AI infrastructure like data centers and power will unlock a multi-trillion dollar long-term investment opportunity.  Data centers are the bedrock of the digital economy, and these investments will help power economic growth, create jobs, and drive AI technology innovation.”

AI Underpins a Future Outside Data Centers

This focus on infrastructure is not solely about data centers. The energy requirements for AI-driven computing tasks demand not merely electric power but also decarbonization strategies, all of which GAIIP will be well-placed to assemble.

Making use of private capital to support improvements in essential infrastructure is critical, says Bayo Ogunlesi, Chairman and CEO of Global Infrastructure Partners:

“There is a clear need to mobilize significant amounts of private capital to fund investments in essential infrastructure. One manifestation of this is the capital required to support the development of AI. We are highly confident that the combined capabilities of our partnership will help accelerate the pace of investments in AI-related infrastructure.”

With GIP’s core business being focused on energy — as in owning and operating large-scale energy infrastructure, a good proportion of which is renewable — it expects it will be there to power the next generation of AI data centers.

 And AI is not just a future technology, it is a fundamental shift  in how we approach the future.

His Highness Sheikh Tahnoon bin Zayed Al Nahyan, Chairman of MGX, remarked: 

“Artificial intelligence is not just an industry of the future, it underpins the future. Through this unique partnership, we will enable faster innovation, technological breakthroughs and transformational productivity gains across the global economy.  The investments we make today will secure a more sustainable, prosperous and equitable future for all.”

The Role of NVIDIA and Broader Industry Collaboration

NVIDIA’s involvement in the design process, and a commitment from CEO Jensen Huang to provide infrastructure support to GAIIP, is crucial to ensuring that the infrastructure and expansion plans of the AI factory follow the accelerating growth of AI innovation.

In the announcement, Huang said:

“Accelerated computing and generative AI are driving a growing need for AI infrastructure for the next industrial revolution. NVIDIA will use its expertise as a full stack computing platform to support GAIIP and its portfolio companies on the design and integration of AI factories to propel industry innovation.”

NVIDIA’s expertise in AI factories – which it defines as data centers “tailored to AI workloads” – would help guide the design and expansion objectives of GAIIP’s infrastructure in the face of mounting demands from generative AI, deep learning, and other cutting-edge artificial intelligence technologies.

But this isn’t just an NVIDIA game. The partnership has committed to an open architecture and inclusive design, and wants to facilitate engagement of a large number of partners, making sure that a very large ecosystem exists that can access its data centers and infrastructure.

By choosing not to use an exclusive group of co-developers and investors, GAIIP becomes accessible to all “private sector companies, public sector, non- profits, and other investors,” which should encourage businesses and investors to get involved.

Long-Term Impact and Competitive Advantage

The plan is for GAIIP to usher in a new era of US competitiveness in AI technology.  Because private capital for AI infrastructure far exceeds any investment that any single company or government can make, GAIIP should work as a force multiplier – not only for AI but for national competitiveness, economic security and prosperity.

As Brad Smith, Vice Chairman and President of Microsoft, said:

“The capital spending needed for AI infrastructure and the new energy to power it goes beyond what any single company or government can finance. This financial partnership will not only help advance technology, but enhance national competitiveness, security, and economic prosperity.”

Blackstone Looks to Lead Investments By Example

While GAIIP will be focused on scaling AI infrastructure in the United States and across the world, Blackstone is leading the charge in the Asia-Pacific region, thanks to its takeover of AirTrunk, announced on Sept. 4.

Earlier this year, Blackstone, along with the Canada Pension Plan Investment Board (CPP Investments), agreed to buy AirTrunk for an estimated Australian $24 billion ($16.34 billion USD), which will be Blackstone’s largest ever investment in Asia.

Referred to as “the fastest-growing data center platform in the Asia-Pacific region,” the transaction cements AirTrunk’s status as APAC’s data-center king, with more than 800 MW of capacity in Australia, Japan, Malaysia, Hong Kong and Singapore — and gives Blackstone instant access to one of the largest and fastest-growing data-center markets in the world.

Driven primarily by the growth of cloud services and the interest in AI, data center spending in the region is forecast to grow more than 100 percent over the next five years, as compared to 2024.

Leveraging Blackstone’s Global Platform

Jon Gray, the asset management firm’s President and COO described the transaction as: 

“Blackstone at its best, leveraging our global platform to capitalize on our highest conviction theme. AirTrunk is another vital step as Blackstone seeks to be the leading digital infrastructure investor in the world across the ecosystem, including data centers, power and related services.”  

 This acquisition affirms AirTrunk’s leadership in the data center space. Robin Khuda, AirTrunk’s Founder and CEO, welcomed the investment, saying:

“This transaction evidences the strength of the AirTrunk platform in a strong performing sector as we capture the next wave of growth from cloud services and AI and support the energy transition in Asia Pacific. We look forward to working with Blackstone and CPP Investments and benefitting from their scale capital, sector expertise and valuable network across the various local markets, which will help support the continued expansion of AirTrunk.”

AirTrunk has the space to support more than 1 GW of future capacity across the region, making it suitable for businesses to scale to meet the growing demand for computing power that AI is creating. The company’s infrastructure will be critical to ensuring that cloud providers and other businesses can harness the power of AI.

Blackstone’s Broader AI Infrastructure Strategy

In addition to the investment in  investment in AirTrunk, Blackstone already owns one of the fastest-growing data center operators in the world in QTS, as well as a stake in CoreWeave, a dedicated cloud provider for AI, as well as a host of other data center companies and dozens of data centers around the world through its investment in Digital Realty.

Blackstone’s data center venture is clearly intent on expanding its foothold in both US and international markets for data centers. This clearly demonstrates the position of venture capital firms and others looking to develop private equity investments in the industry.

Just as Blackstone invests in data centers, however, it also invests in the very infrastructure that enables AI, including power.

In 2022, the company invested $3 billion in Invenergy, the largest independent renewables developer in the United States. At the time it was one of the largest investments in renewables seen in North America.

And now, Blackstone has positioned its data centers to benefit from the global movement to decarbonize the digital economy.

The Future of AI Infrastructure Investment?

With Blackstone and GAIIP investing large sums into AI infrastructure, it’s becoming apparent that this technology revolution will be driven by energy and AI.

The capital outlays required to build an appropriate infrastructure will be record-setting, with some analysts believing that corporations will spend an astonishing $1 trillion just in the U.S. market over the next five years, with another $1 trillion in global markets.

The companies talked about here are spearheading this effort, providing the capital, talent and infrastructure that will drive AI expansion.

In an era of AI-driven industrial transformation, the data centers and supporting power infrastructure they support will play a crucial role in enabling the wider adoption of AI by businesses, governments and societies.