Jim Chanos' latest big short: data centre REITs

Goola Warden
Goola Warden6/29/2022 06:15 PM GMT+08  • 4 min read
Jim Chanos' latest big short: data centre REITs
44520 Hastings Drive, Northern Virginia, a Digital Core REIT property
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According to the Financial Times, short seller Jim Chanos believes that data centres in REITs and that are not owned by Alphabet, Microsoft and Amazon are going to be behind the curve so to speak. The web service arms of the trio, Google Cloud, Amazon Web Services and Microsoft Azure have their cloud services housed in their own leading edge data centres. For instance Google has a state-of-the-art data centre in Jurong.

Chanos is quoted to have said the cloud is growing but “the cloud is their (the REITs’) enemy, not their business. Value is accruing to the cloud companies, not the bricks-and-mortar legacy data centres.”

In fact, Alphabet, Amazon and Microsoft are likely to be the REITs’ biggest competitors, not their biggest customers. When your biggest competitors are the three most vicious competitors in the world you have a problem, Chanos is reported to have said.

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