Anthropic’s $35 billion cloud agreement with Lambda has put the Beacon Point Data Center in Texas firmly in the spotlight. The six-year deal provides for approximately 350 megawatts of computing power for Anthropic’s AI initiatives. Meanwhile, Nvidia will reportedly lease the facility and provide Lambda with chips. Hut 8 is building the huge one-gigawatt facility in Nueces County.

The agreement creates an unusual four-company structure involving Hut 8, Nvidia, Lambda, and Anthropic. In particular, Hut 8 builds the facility and rents out capacity to Nvidia. Before selling computing services to Anthropic, Lambda will install Nvidia chips. The $35 billion is Anthropic’s commitment to cloud services for Lambda, not the cost of building it. The combined base-term value of the separate leases at Hut 8 is $19.6 billion for 15 years.

Another major agreement inked is for Google’s West Memphis data center where Google will invest $526 million in Cypress Solar, a renewable energy facility built specifically to power the campus. The 600-megawatt solar field with 350-megawatt battery storage will therefore power the electrical grid that supplies Google’s massive artificial intelligence operations. The Cypress Solar facility is located in Jefferson County, Arkansas, approximately one-third of the $1.6 billion total project cost. In the meantime, Google will pay an extra $190 million to Entergy for necessary upgrades to its transmission system.

Beacon Point Data Center Fully Leased Across Two Phases

The Beacon Point Data Center is a 704MW (352MW x 2) contracted information-technology facility. As a result, the campus is fully leased with one gigawatt of available utility capacity. Hut 8 initially kept its investment-grade technology tenant unnamed. Later reports, however, named Nvidia as the company behind the leases. The two leases have a combined base-term value of $19.6 billion, with annual rent increases of 3%. In addition, three five-year renewal periods could boost their value to $50.2 billion at the campus level. The approximately 350MW covered by Anthropic’s Lambda deal closely matches one of Beacon Point’s 352MW phases. However, there is no evidence at this time that Anthropic will ever make use of the extra space on campus.

Construction Backed by $4.25B Financing

Hut 8 has invested $4.25 billion in senior secured notes for the first phase of construction at Beacon Point. The debt has an interest rate of 6.129% and will be paid off in 2042. Further, financing is secured by project assets and is non-recourse to Hut 8’s parent company. Initial energisation is planned for the first quarter of 2027. Meanwhile, the first Phase 2 data hall should be delivered during the second quarter of 2028.

Project Overview

• Project Name: Beacon Point Data Center
• Lease Value: $19.6 Billion
• Phase 1 Financing: $4.25 Billion
• Location: Nueces County, Texas
• Developer: Hut 8

Scope

• One-gigawatt utility capacity
• 704MW contracted IT capacity
• Two 352MW development phases
• Nvidia-powered AI infrastructure

Project Highlights

• Anthropic-Lambda deal worth $35 Billion
• Campus fully leased across both phases
• Nvidia reportedly holds facility leases
• Renewal options could reach $50.2 Billion

Key Developments

• Phase 1 energization targeted Q1 2027
• First Phase 2 data hall due Q2 2028
• Nvidia supplies chips to Lambda
• Anthropic purchases Lambda computing capacity

Outlook

• Project targets intensive AI workloads
• Stabilized NOI projected at $1.31 Billion annually
• Delivery depends on construction and power milestones
• Tenant leases run for 15 years