I Squared Capital, a Miami-headquartered global infrastructure investment manager, has entered into a definitive agreement to acquire ten data center facilities from Cogent Fiber, LLC, an indirect wholly owned subsidiary of Cogent Communications Holdings, Inc., for USD 225 million in cash.

The deal will seed a new U.S. operating platform focused on colocation, high-density deployments, and artificial intelligence inference infrastructure, with I Squared committing up to USD 1 billion to build the platform over time.

The Seed Portfolio

The ten facilities being acquired span nine U.S. markets: Chicago, Atlanta, Phoenix, Los Angeles, Kansas City, Baltimore, Houston, Nashville, and Stockton. Together, those nine markets serve a combined population of over 63 million people.

The portfolio comprises approximately 53 megawatts of installed power capacity and approximately 259,000 square feet of available colocation space. All ten facilities are described as purpose-built data centers owned fee simple, meaning I Squared will hold outright ownership of the underlying real estate rather than operating under lease arrangements.

Each facility also has room for physical expansion and is capable of supporting higher-density deployments, including liquid-cooling-enabled configurations — an increasingly important technical requirement as power-hungry AI workloads demand more intensive thermal management.

The facilities feature diverse and dense fiber connectivity with close proximity to local internet exchanges. I Squared noted that this positioning makes the portfolio suitable for a broad range of workloads, including retail colocation, wholesale colocation, content distribution, and latency-sensitive AI inference workloads.

Strategic Rationale

The transaction is designed to capture what I Squared describes as a structural shift in how artificial intelligence is being used. Gautam Bhandari, Co-Founder, Managing Partner, and Global Chief Investment Officer of I Squared Capital, framed the opportunity in terms of AI's evolution from the training phase to the inference phase.

"As AI moves from the training phase, where models are built, to the inference phase, where they are used by people and businesses every day, demand for high-density, low-latency facilities like these will only grow," Bhandari said.

He also pointed to the supply dynamics in the markets where the acquired facilities are located. "Location, power, and connectivity are the three variables that determine a data center's long-term value, and these facilities have all three in markets where new supply is severely constrained," Bhandari said.

The inference workload market differs meaningfully from the large-scale, hyperscale training campuses that have dominated data center investment headlines in recent years.

Inference, the process of running a trained AI model to generate outputs for end users, tends to require geographically distributed infrastructure positioned close to end users to minimize latency. The portfolio's presence across nine distinct metro areas, each with its own regional population base, is positioned to address that need.

Platform Construction and Capital Commitment

Upon closing, I Squared will establish a new, standalone operating platform to own, operate, and grow the business. The firm indicated that a seasoned management team will be in place from the first day of operations.

The USD 225 million acquisition price represents the seed investment for the platform, with I Squared committing up to USD 1 billion in total capital to be deployed through targeted capital investment, customer-led expansion, and additional acquisitions beyond the initial ten facilities.

The approach follows what Bhandari described as I Squared's broader investment methodology. "This transaction is consistent with I Squared's disciplined approach to building infrastructure platforms from the ground up by acquiring strategically located assets and investing the capital and operational expertise needed to unlock their full potential," he said.

The data centers' combination of owned real estate, existing high-density-enabled power infrastructure, and multi-carrier interconnection is cited as the foundation on which I Squared intends to scale the platform.

Transaction Timeline and Advisors

The transaction is expected to close in the third quarter of 2026, subject to customary regulatory approvals, including the expiration of the applicable Hart-Scott-Rodino waiting period.

Hart-Scott-Rodino filings are required under U.S. antitrust law for acquisitions above certain size thresholds, and the waiting period gives federal regulators time to review the deal before it proceeds.

TVG Consulting Group LLC served as commercial and market advisor to the transaction. Kirkland and Ellis LLP served as legal counsel. FTI Consulting served as carve-out and stand-up advisor, a role that typically involves helping separate a business unit from its former parent and establishing it as an independent operating entity.

The seller, Cogent Fiber, LLC, is an indirect wholly owned subsidiary of Cogent Communications Holdings, Inc., which trades on the Nasdaq exchange under the ticker CCOI. Cogent Communications is a multinational internet service provider and network operator.

About I Squared Capital

I Squared Capital was founded in 2012 and describes itself as an independent global infrastructure investor dedicated to the mid-market. The firm manages USD 60 billion in assets across sectors including power and utilities, transportation and logistics, digital infrastructure, environmental infrastructure, and social infrastructure.

Its portfolio includes over 100 companies operating in more than 70 countries. In addition to its Miami headquarters, I Squared maintains offices in Abu Dhabi, London, Munich, New Delhi, São Paulo, Singapore, Sydney, and Taipei.

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