What must the capital partner do to get a site ready for a JV decision?
Starwood runs the pre-development work. It pursues the power, the approvals, the tenant and the financing, but may not sign the lease or close the loan. Leasing must focus on investment grade hyperscalers, or on enterprise tenants and neoscalers with investment grade credit support. Starwood may not steer a tenant to its own sites without a legitimate business reason. Financing from a Starwood affiliate is allowed only if it was chosen through a marketed process. MARA may comment on the business plan and budget, but Starwood decides them. Ground leases are to be made financeable, for example by adding lender cure rights. For in-house teams: these duties set the standard for the development package, so be specific about tenant quality, power and conflicts.
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What the filed contracts say
Contract
What the filed wording says
MARA–Starwood strategic agreement
The capital partner pursues power, approvals, the tenant and the financing, but may not sign the lease or close the loan.
MARA–Starwood strategic agreement
Leasing targets investment grade hyperscalers, or tenants with investment grade credit support.
MARA–Starwood strategic agreement
It may not steer a tenant to its own sites without a legitimate business reason.
MARA–Starwood strategic agreement
Affiliate financing only through a marketed process.
MARA–Starwood strategic agreement
The landowner comments on the business plan and budget; the capital partner decides.
MARA–Starwood strategic agreement
Ground leases are to be made financeable, for example with lender cure rights.
The filed wording
(iii) together with MARA, pursue or continue to pursue the applicable Power Contingency with respect to such Target Property; … (iv) commence, or continue, as applicable, leasing activities with respect to such Target Property in an effort to procure (but not execute) an Approved Lease with respect to such Target Property, including, without limitation, (A) initial marketing, (B) canvassing the market with all tenants with a focus on investment grade hyperscalers and enterprise tenants or neoscalers with shadow credit or credit enhancements provided by investment grade sources for the length of the applicable lease term … Starwood and its Controlled Affiliates shall not be permitted to actively divert a potential tenant of such Target Property to any other property owned by Starwood or its Controlled Affiliates (or a property with respect to which Starwood or its Controlled Affiliates earn fees) unless there is a legitimate business reason why such Target Property will not satisfy the needs of such potential tenant, as determined by Starwood acting reasonably and in good faith); … (vii) pursue (but not close) financing for the development of the Data Center Facility or Data Center Facilities intended to be developed on such Target Property that is consistent with the Qualified Financing Criteria (the “Financing Terms”), which Financing Terms may be provided by an Affiliate of Starwood so long as Starwood selected such Financing Terms from such Affiliate through a marketed process; … it being acknowledged and agreed that MARA will have the right to review and comment on each applicable development business plan and budget and design development plans and Starwood will consider such comments in good faith, but the approval and finalization of the final Development Business Plan and Budget and the final design development plans for each Target Property shall be determined by Starwood; … customary provisions that would make the applicable ground lease “financeable” (e.g., by adding lender cure rights)
MARA–Starwood strategic agreement to develop MARA’s sites as data centres through joint ventures, section 4(a) · MARA Holdings 8-K, Exhibit 10.1
Each extract is quoted from the contract as filed with the SEC, checked against the filed text when it was added; “…” marks words left out. Filers redact commercial terms, so a [***] or [*] is the filer's, not ours. The summaries describe the wording, not how a court would read it, and each contract's defined terms and other clauses can change the effect. General information drawn from public filings. It is not legal advice on any transaction, and using this page does not create a lawyer-client relationship. Views are personal.
InfraCompute Weekly
The week in compute finance, read from the filings.
Deals, terms and the clauses behind them, for the people financing data centres, GPU clouds and the power behind them. By Randeep Bubbra.
