Meta and BlackRock have established a $14 billion partnership to develop an AI data center in El Paso.

      Meta has combined its partially constructed El Paso data center into a joint venture with BlackRock, establishing a framework that removes most of the $14 billion project from its own financial statements.

      According to the agreement, funds managed by BlackRock will possess 80% of the Texas campus, while Meta retains the remaining 20%. Meta will continue to act as the construction manager, property manager, and sole tenant once the servers are operational in 2028.

      This venture brings the total development cost to about $14 billion, and the division of this sum is the crux of the deal. BlackRock is contributing approximately $4.9 billion in cash at the financial closure, while Meta is transferring the land and ongoing construction it has already invested in, valued at around $2.3 billion. Additionally, Meta will receive a one-time distribution of $1 billion to align ownership interests.

      The remaining $12.5 billion will come through debt raised against the project rather than Meta itself, allowing the company to account for its use of the campus as rent instead of capital expenditure. This distinction is particularly significant this year as Meta has projected capital expenditures of $125 billion to $145 billion for 2026—a range it increased in April—and it is under pressure to demonstrate that its investment in AI will prove beneficial.

      The financing has been developing over several weeks, with BlackRock securing the necessary borrowings for the campus earlier this month after Meta had already put together a financial package that briefly set a new benchmark for AI financing at a single site. The debt amount grew from the approximate $12 billion to $13 billion range discussed in earlier meetings to the now confirmed $12.5 billion figure.

      BlackRock is managing the deal through Global Infrastructure Partners and HPS Investment Partners, two branches targeted at data center assets since its acquisition of Aligned Data Centers for $40 billion. The firm is executing both sides of these arrangements—originating the infrastructure and subsequently selling the debt that finances it—while El Paso aligns closely with this model.

      For Meta, the appeal lies in a strategy it has employed previously. In rural Louisiana, it kept most of its $200 billion Hyperion campus off its balance sheet by allocating 80% to an external investor and leasing the site back, and the El Paso structure mirrors this approach nearly identically.

      The initial lease term is four years, with four options for extension that could extend the agreement to two decades. Separately, Meta has stated its intention to invest approximately $600 billion in U.S. infrastructure through 2028, although this figure represents a commitment rather than a dedicated budget.

      The structure is not without risk, as the debt associated with these campuses tends to have long durations, while the servers inside depreciate over just a few years, creating a possibility that the lease duration may be shorter than that of the equipment it houses.

      The campus is designed to provide a gigawatt of computing power for Meta's AI systems and its core advertising operations, with power expected by 2028, which would categorize it as one of the larger facilities the company has committed to outside of Louisiana.

      BlackRock reports that around 2,300 individuals are already employed at the site, construction should peak above 4,000 jobs, and about 300 permanent positions will remain once the campus is operational. The company has also committed to training around 12,000 electricians over three years through a program called Future Builders, recognizing the labor shortage affecting large data center projects.

      Mark Zuckerberg highlighted the venture as a means to expedite progress, stating that the collaboration with BlackRock “enables us to move faster and at greater scale,” linking it to Meta's ambition of establishing infrastructure for what he terms superintelligence. Larry Fink, BlackRock’s CEO, framed it as evidence of the capabilities his firm is building, asserting that the deal exemplified “the strength and scale of our combined capabilities with GIP and HPS.”

      Neither executive addressed the crucial question behind the figures: what would happen if the computational resources Meta is acquiring at this scale take longer than 2028 to become profitable.