Centuria pays $21m for a half stake in Reset Data ahead of data centres across Australia

Centuria will pay $21m for a half stake in Reset Data as the pair roll out their new data centres across the country – with unwanted office space the first target.

Centuria Capital Group joint CEOs John McBain and Jason Huljich at their offices. Picture: Hollie Adams/The Australian

Real estate fund manager Centuria Capital has snapped up a half interest in a new-generation data server provider, Reset Data, and the pair will roll out a series of new style data centres across Australia to capitalise on the Artificial Intelligence boom.

The pair are the latest groups to stake a position in the surging sector and claim their focus on new-style Liquid Immersion Cooled Edge Data Centres will give them edge over traditional, less efficient centres.

Centuria is paying just $21m for a half stake in Reset Data but it is hoping to make data centres a key part of its $21bn real estate empire across Australia and NZ. The move is also a pointer to what could become a use of unwanted office blocks, with the pair to put a data centre into a Docklands block owned by a Centuria fund.

Centuria said it had an early mover advantage by shifting into liquid immersion cooled edge data centres as it would use a dual PropCo (Property Company) and OpCo (Operating Company) structure.

Centuria’s play is aimed at harnessing the tailwinds from the growth in both data storage and AI, with the global cloud service market expected to top $US2.2 trillion by 2032. Australia’s cloud services are forecast to reach more than $23.2bn in 2024.

Reset Data uses proprietary liquid immersion cooling technology for its data centres, which are smaller than traditional data centres and use less energy than those relying on air cooling servers, which gives them a lower carbon footprint. These aspects mean the centres can slot into existing office blocks rather than taking up massive outer city warehouses, which also means connections with users are better.

Centuria is acquiring a 50 per cent in next generation data centre provider Reset Data.

“We are looking to build AI factories of tomorrow with the LIC technology enabling deployment of cloud-based technologies in less space, requiring fewer resources and with a significantly reduced carbon footprint. Most importantly, this is technology that fits within existing office floorplates while generating significantly higher rents per square metre compared to typical office occupants,” Centuria joint chief executive Jason Huljich said.

He added that a “critical consideration” in entering the Reset Data deal was the potential for Centuria to create value for its direct and listed real estate portfolios.

The move on Reset Data would allow it to “unlock value from vacancies within our office portfolio by establishing a network of edge data centres that can service tenants as well as other businesses in proximity”.

“Depending on asset suitability, Centuria expects that the acquisition will provide opportunities to enhance rental streams and property valuations for our property funds, in addition to providing our tenants with access to local cloud storage,” he said,

Reset Data already works with global giants Dell, Nvidia, Submer and Unicom Engineering to provide its technology, which is billed as more efficient than traditional centres.

A 2.4sq m LIC pod produces 140kW, meaning 100sq m of ‘white space’ inside an office floor could potentially house up to 1.5MW of capacity. By contrast, a traditional 1.5MW data centre needs about 1,000sq m of white space.

The system also has zero water waste compared to the heavy requirements of air cooling systems, which have sparked environmental concerns.

Centuria joint chief executive John McBain said Reset Data was an “early mover opportunity in a rapidly growing sector” that would also be a point of difference for the company’s real estate funds.

Reset Data joint chief executives Bass Salah and Marcel Zalloua said they were keen to work with Centuria on scaling up their new generation data centres. They will start with a block at 818 Bourke St in Melbourne’s Docklands, which will become one of the country’s first Liquid Immersion AI inferencing and ultra high-density data centres.

Reset Data has struck a 10-year lease, for up to 1.5MW, in the Centuria-managed block, with the deal showing the potential to lift its value by 10-15 per cent after costs.

Originally published as Centuria pays $21m for a half stake in Reset Data ahead of data centres across Australia