Davis Polk partner Brian Hirsch was quoted in Tech Capital discussing the advantages and disadvantages of 144A data center financing. 

The article noted that data center financing is moving beyond conventional real estate-style lending as AI and hyperscale projects are ever-expanding.

Discussing the reasoning behind 144A financing, Brian said, “It’s a deep market right now, the main attraction for a lot of people is it’s a short process that puts money in their bank account.”

The article added that compared with traditional project finance, 144A structures can reduce the need for monthly construction updated to ongoing lender administration, but Brian pointed out that also means borrowers may lose the benefit of having lenders closely review the project during construction.

“There is an advantage to lenders looking at things [and] seeing where the issues are,” he said, noting that this also means borrowers may lose the benefit of having lenders closely review the project during construction.

Discussing the discrepancy between data center leases that run for 10 to 15 years and some 144A debt that may mature in three to five years, Brian noted, “You may have a bigger problem because you have a ballon payment due, and now you have to figure out how you’re going to solve a problem.”

“The Quest for Liquidity,” The Tech Capital (August 7, 2026)

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