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Data Center Companies Investing in Brazil’s Booming Market

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Brazil is rapidly becoming a critical hub for data center investments, with billions of dollars expected to be injected into the sector in the coming years. This surge is largely driven by the booming demand for artificial intelligence (AI) and the growth constraints faced by larger markets in the U.S. and Europe. Several key companies are capitalizing on Brazil’s potential for data center expansion:

Ascenty
Ascenty, one of the largest data center operators in Latin America, is actively seeking a minority partner to support its expansion, particularly in Brazil. Currently, Ascenty operates 34 data centers across the region, with many more under construction. The company is jointly controlled by Brookfield Asset Management and U.S.-based Digital Realty.

Grupo FS
Grupo FS, a Brazilian cybersecurity firm, is making a significant move into the data center market with plans to invest $1.8 billion (approximately $300 million) to build three data centers in Brazil. Owner Alberto Leite cites Brazil’s political stability, abundant renewable energy resources, and growing local demand as key drivers behind this investment.

Equinix
Global digital infrastructure giant Equinix is expanding its footprint in Brazil, with new projects planned in São Paulo and Rio de Janeiro. Eduardo Carvalho, Equinix’s managing director for Latin America, emphasized that the Brazilian market is critical for the company’s long-term strategy.

ODATA
ODATA, now owned by Aligned Data Centers, is experiencing steady growth due to increasing demand in Brazil. The company is particularly focusing on investments in São Paulo and Rio de Janeiro. ODATA also has operations in Chile, Colombia, Mexico, and the U.S. following its acquisition by Aligned.

Tecto
Tecto, the data center unit of V.tal (controlled by BTG, a Brazilian investment bank), recently acquired new land in São Paulo for the development of a 200MW hyperscale data center powered entirely by renewable energy. Tecto has committed an initial $1 billion for new projects and is expanding its presence across Brazil and Colombia.

Elea
Elea Data Centers operates across all major Brazilian cities, including the Rio-São Paulo axis, and is focused on sustainability, running its data centers entirely on renewable energy. The company has expanded its footprint to include the Southeast, South, and Central West regions of Brazil.

These investments highlight Brazil’s growing importance as a data center hub, driven by favorable energy conditions, political stability, and a booming demand for cloud services, AI, and data storage.

 

Brookfield Seeks Partner for Ascenty Amid Brazil’s Booming Data Center Market

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Brookfield Asset Management is reportedly looking for an investment bank to advise on the sale of a minority stake in Ascenty, a major data center operator in Latin America. This move comes as Brookfield, in partnership with Digital Realty, aims to attract a minority partner to fund Ascenty’s ongoing expansion, particularly in Brazil. The companies have approached local banks, such as Itaú BBA and Bradesco BBI, for the advisory role.

Ascenty’s growth plans align with Brazil’s rising status as a key global data center hub. Demand for cloud computing and artificial intelligence is driving substantial investments, with estimates suggesting that over $10 billion could be funneled into Brazil’s data center sector over the next decade. Despite having fewer than 200 data centers, Brazil already ranks among the top 15 global markets. A report by Santander projected a 7.1% annual revenue increase for the sector from 2024 to 2028, outpacing the global average.

Brookfield initiated discussions with potential banks in 2024, aiming to complete the sale by the end of 2025. Founded in 2010, Ascenty currently operates or is constructing 34 data centers across Brazil, Mexico, Chile, and Colombia. These facilities are connected by an extensive 5,000-kilometer fiber-optic network. Although the valuation of Ascenty remains uncertain, its rapid expansion since Brookfield and Digital Realty’s $1.8 billion acquisition in 2018 indicates significant growth.

Ascenty’s expansion in Brazil is facilitated by the country’s availability of land, solid global connectivity, and an increasing renewable energy capacity, which makes it an attractive location for future data center investments. While competitors like Tecto Data Centers, Equinix, and ODATA are active in the region, Brazil’s potential for data center growth remains high, especially as energy constraints challenge other markets like the U.S. and Europe.

Market projections suggest Brazil’s energy load from data centers could increase substantially over the next decade, highlighting both the opportunities and challenges in expanding the country’s infrastructure to meet this demand. Official estimates suggest data center energy demand could rise to 9 GW by 2035, a massive increase from the current load of 671 MW, necessitating careful planning in transmission and distribution networks.