NextDC announced its planning to raise AU$672 million to fund a new facility in Sydney. At the same time, NextDC has warned that long-term effects of the COVID-19 outbreak that would cause uncertainty over the government response, and a possible Australian economic recession. With building this new facility, NextDC aims to reach what it called growth initiatives.
Funding near-term growth opportunities
NextDC’s S3 facility in Sydney’s Gore Hill will be located 10 km from the central business district and 7km and 8km from NextDC’s S1 and S2. The company expected that the first phase will cost AU$350m ($210m). The initial IT load is expected to be 12MW, with a total capacity of 80MW expected by the first half of 2022.
NextDC’s CEO Craig Scroggie told shareholders,
“Based on the strong level of orders already received for S2 and our growing confidence in the forward sales pipeline, NextDC is confident that the projected demand in Sydney, together with our return expectations, warrants the next phase of investment in Sydney’s third generation of data centers. NextDC continues to see significant demand for its data center services during a turbulent market environment due to COVID-19.
We have decided to prudently equity fund near-term growth opportunities in this period of market volatility to continue to support customer demand and ensure there is no loss in the momentum of the company’s development.”
For the first half of the financial year, NextDC has raised its revenue to AU$95m ($57m). Despite this rise, the company saw an increased net loss of nearly AU$5m ($3m).