DigiCo's Chicago Asset Sale Funds Growth, But the Valuation Gap Remains

A premium sale of its Chicago data centre asset replenished the balance sheet for Sydney expansion, yet DigiCo still trades at a substantial discount to NEXTDC.

24 Aug 2026 · 3 min read

DigiCo Infrastructure REIT sold its Chicago hyperscaler data centre asset at a 5 percent premium above its original purchase price, replenishing the balance sheet to fund expansion of its Sydney facility, even as the resulting FY27 earnings transition period and higher capex per megawatt from the accelerated Sydney Ultimo build left the stock trading at a substantial discount to peer NEXTDC.

A well-timed data centre asset sale at a premium

Pendal Group said the stock rose 16.7 percent after announcing the sale of its hyperscaler data centre asset in Chicago, CHI1, completed at US$750 million, representing a 5 percent premium to the original purchase price of US$712 million in December 2024, with CHI1 carrying 32MW of IT capacity and a 15-year lease agreement with Oracle. The outcome was particularly notable given concerns around the asset due to its Oracle lease in a non-purpose-built facility, with the sale price equating to $23.4 million per megawatt.

The transaction was completed at US$750 million, representing a 5% premium to the original purchase price of US$712 million in December 2024. This outcome is particularly notable given concerns around the asset due to its Oracle lease in a non-purpose-built facility. The sale price equates to $23.4 million per MW.

— Pendal Group, Newsletter, May 2026

Balance sheet replenishment funds Sydney expansion and energy transition ambitions

Wilson Asset Management said DigiCo has done a great job more recently selling off non-core assets in the US, replenishing its balance sheet and leaving it in great shape to continue expanding its Sydney facility, with really exciting growth opportunities across the broader HMC platform, including an energy transition platform in Victoria with access to significant battery and wind assets, trading on half the multiple of NEXTDC and, on a net tangible asset basis, about a 40 percent discount.

They've done a great job more recently in terms of selling off some non-core assets in the US. They've replenished the balance sheet. It's in great shape now to continue to expand the Sydney facility. It trades on half the multiple of NEXTDC, and on an NTA basis, it's about a 40% discount.

— Wilson Asset Management, Article, July 2026

A reasonable land sale, guidance reaffirmed

Asymmetric Asset Management said DigiCo declined 7.6 percent despite announcing the sale of a former parcel of land the market already knew would not be developed into a data centre in Los Angeles, with the outcome reasonable and the sale price broadly in line with the acquisition price, alongside reaffirming FY26 guidance for underlying EBITDA of $125 million.

A transition year guidance beats FY26 but softens FY27

Pendal Group said DigiCo's result was mixed, with FY26 EBITDA of $127 million beating guidance, but FY27 EBITDA guidance of $120 million to $125 million reflecting the CHI1 asset sale and a transition period, with investor concern centred on lower near-term earnings even though FY28 and FY29 forecasts were upgraded, alongside execution risk around planned asset sales and higher capex per megawatt from the accelerated Sydney Ultimo build. Pendal still sees key catalysts intact, including binding-contract conversion and a now fully-committed Sydney Ultimo project.

What fund managers say they are watching next is conversion of binding contracts at the Sydney Ultimo project, delivery of the upgraded FY28 and FY29 forecasts once the transition period passes, whether the stock's 40 percent NTA discount and half-NEXTDC-multiple valuation closes, and continued expansion opportunities in the Victoria energy transition platform.