How New Data Center Debt Concessions Could Stall AI Build-Outs

Bond markets are getting tough for lower-rated borrowers. One example: CleanSpark, which is developing a data center for Meta Platforms, had to offer investors big concessions to land financing earlier this month.

That deal is among the clearest signs yet that financing the data center boom is getting expensive across the board, and investors are getting picky about which new projects they’ll back. The bank loan market too is showing signs of strain, with some lenders like Société Générale, Sumitomo Mitsui Banking Corp. and Mitsubishi becoming more selective in lending to data center projects, people arranging the deals say. Those dynamics mean companies could struggle to borrow for planned data centers, jeopardizing growth plans for the broader AI industry.