Bridging a $1.5 Trillion Data Center Financing Gap

Morgan Stanley identifies a $1.5 trillion financing gap for global data centers through 2028, projecting that credit markets—led by an $800 billion private credit/ABF opportunity—will be essential to bridging it.

Key Takeaways

• 1.Morgan Stanley forecasts a $1.5 trillion financing gap for global data center investment through 2028, as total capex needs ($2.9 trillion) far exceed expected hyperscaler cash flows ($1.4 trillion).
• 2.Private credit, specifically Asset-Based Finance (ABF), is expected to fill over half of this gap with an estimated $800 billion opportunity.
• 3.The securitized credit market (ABS and CMBS) is projected to provide $150 billion in financing, representing up to 25% of new data center capacity in the US by 2028.

Table of Contents

• Executive Summary – The Growing Role of Credit Markets in Financing GenAI
• Sizing the Spend: A ~$2.9tr Opportunity
• Technology Credit: Expect ~$200bn of Bond Issuance to Complement Sizable Cash Flows and New Leases
• Securitized Credit: An Increasingly Sought-After Take-out Option
• An $800bn Opportunity in Private Credit, Led by Asset-Based Finance (ABF)

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