A U.S.-based high investment-grade hyperscaler has signed a $5.2 billion, 15-year lease for 210 megawatts of critical IT capacity at Applied Digital’s Delta Forge 2 AI Factory campus in a southern U.S. state, marking the company’s fifth AI campus and further validating its franchise-style scaling model.
The agreement also extends an existing relationship, with the same customer having previously signed two long-term contracts with Applied Digital, making this the third major deal and reinforcing a pattern of repeat, long-term commitment rather than a one-off expansion.
A Scaling “Franchise” Model for AI Infrastructure
According to company leadership, the Delta Forge 2 deal is part of a broader strategy built around repeatable deployment rather than bespoke builds.
CEO Wes Cummins has described the approach as a “franchise model,” where design, construction, and operations are standardized and replicated across multiple campuses. The company is now executing this model across five AI factory campuses, aiming to turn data center development into a scalable platform rather than isolated infrastructure projects.
The latest lease further validates that strategy, showing that hyperscalers are willing to commit long-term capacity across multiple sites as demand for AI compute accelerates.
Contract Scale and Long-Term Revenue Visibility
The Delta Forge 2 agreement covers 210 MW under a 15-year structure with renewal options extending up to 30 years. While the base-term value is approximately $5.2 billion, total revenue potential could rise to around $12.7 billion if all extensions are exercised.
On a broader portfolio level, Applied Digital reports:
- Around 1.4 GW of contracted critical IT load across five campuses
- Approximately 2.15 GW of grid-connected utility power secured
- Roughly $36 billion in contracted base-term lease revenue
- Up to $86 billion in total potential revenue including renewals
A significant portion of this pipeline—about 70%—is backed by U.S.-based investment-grade hyperscalers, reinforcing the credit strength behind the company’s long-term cash flows.
The take-or-pay structure is a key feature of the agreements. It requires the customer to pay regardless of actual utilization, providing revenue stability and reducing operational risk for the developer.
Purpose-Built for AI Workloads
Delta Forge 2 is designed specifically for next-generation AI computing rather than traditional cloud hosting. The campus is engineered for high-density GPU workloads used in training and inference at scale.
A standout feature is the inclusion of proprietary waterless cooling technology, which reduces dependency on water resources—an increasingly important constraint in data center development. The design also supports high power density configurations, allowing significantly more compute per square foot compared to conventional facilities.
Initial operations are expected in Q1 2028, giving the project a multi-year construction and commissioning timeline.
From Data Centers to Industrial-Scale AI Platforms
The broader significance of the deal lies in how it reflects the evolution of the data center sector itself. What was once a highly customized, site-specific industry is shifting toward standardized, repeatable infrastructure platforms.
Applied Digital is positioning itself within that shift by treating its campuses as a scalable product rather than one-off developments. The goal is to replicate the same engineering, procurement, and operational framework across multiple geographies, reducing complexity while accelerating deployment timelines.
This approach is central to the company’s pitch to investors: transforming data center development into a predictable, scalable infrastructure business aligned with the long-term needs of hyperscalers.
Strategic Demand and Geopolitical Tailwinds
The deal also highlights broader structural trends shaping AI infrastructure investment.
Hyperscalers are increasingly locking in capacity years in advance, reflecting expectations of sustained growth in AI workloads. At the same time, the concentration of investment-grade U.S.-based customers underscores a growing preference for domestic compute infrastructure, particularly as AI becomes strategically sensitive at the national level.
Sustainability is also becoming a decisive factor. Waterless cooling and energy-efficient design are no longer optional features but competitive requirements, particularly in regions facing resource constraints.
Community and Economic Impact
Site selection for Delta Forge 2 reflects another layer of the company’s strategy: aligning large-scale infrastructure investment with local economic development.
According to management, the company prioritizes communities where its investments can have a measurable impact on jobs, tax revenue, and long-term economic activity. Large construction phases and ongoing operations are expected to generate sustained employment and fiscal benefits in the host region.
Applied Digital also documents parts of its development process through its “Behind the Build” series, offering public visibility into construction progress and community engagement as campuses are developed.
The Bigger Picture
Taken together, the Delta Forge 2 lease represents more than a single contract. It reinforces the emergence of AI infrastructure as a long-duration, capital-intensive asset class anchored by highly creditworthy tenants.
With five campuses under development, tens of billions in contracted revenue, and expanding hyperscaler relationships, Applied Digital is positioning itself as a key industrial player in the AI buildout rather than a traditional data center developer.
The location of Delta Forge 2 remains undisclosed, consistent with Applied Digital’s approach of selectively announcing site details during early development phases. The company has followed a similar disclosure pattern in previous projects, including its $3.6 billion Delta Forge 1 AI data center campus in Louisiana, which was only revealed after significant progress had already been made since January 2026. Additionally, his development comes amid broader activity in the U.S. AI data center market, including DataBank’s Red Oak campus in Texas, which has secured major financing to accelerate hyperscale infrastructure buildout.
Factsheet: Applied Digital – Delta Forge 2 AI Data Center Lease
Company: Applied Digital
Industry: AI infrastructure / hyperscale data centers
Key Deal Overview
- Asset: Delta Forge 2 AI data center campus
- Capacity: 210 MW critical IT load
- Lease term: 15 years (take-or-pay structure)
- Customer: U.S.-based investment-grade hyperscaler (undisclosed)
- Relationship: Third long-term contract with same customer
Financial Highlights
- Base-term revenue: $5.2 billion
- Potential total value (with renewals up to 30 years): $12.7 billion
- Contract structure: Guaranteed payments regardless of utilization
Portfolio Scale
- Total contracted IT load: 1.4 GW (5 campuses)
- Grid-connected power secured: 2.15 GW
- Base-term contracted revenue: ~$36 billion
- Total potential revenue (with renewals): ~$86 billion
- Revenue backed by investment-grade U.S. hyperscalers: 70%
Project Details – Delta Forge 2
- Location: Undisclosed southern U.S. state
- Expected start of operations: Q1 2028
- Design focus: High-density AI compute (GPU workloads)
- Cooling technology: Proprietary waterless cooling system
- Purpose: AI training and inference infrastructure
Business Model
- “Franchise model” for repeatable AI campus deployment
- Standardized design, construction, and operations across sites
- Multi-campus expansion strategy (currently 5 campuses)
Strategic Highlights
- Long-term hyperscaler demand secured years in advance
- Strong reliance on investment-grade customers
- Shift from project-based builds → scalable infrastructure platform
- Emphasis on sustainability (waterless cooling)
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