Who Holds the Long Years
Meta sold four-fifths of its largest data center in October 2025 and agreed to rent it back. The campus is called Hyperion and it is going up on more than two thousand acres of farmland in Richland Parish, in the north-east corner of Louisiana. Funds run by Blue Owl Capital took the stake. A vehicle on the Blue Owl side called Beignet Investor then sold about twenty-seven billion dollars of bonds to pay for the buildings and the power and cooling inside them. S&P rated the bonds one notch below Meta itself. They pay a little more than six and a half percent a year and they fall due in May 2049.
Stijn Van Nieuwerburgh, a professor of finance at Columbia Business School, sets that deal inside a much larger one in a paper for the Brookings Papers on Economic Activity this autumn. He counted the data center projects planned across the United States and estimated how many will be built. On his central case the country will spend about ten trillion dollars on data centers and their chips and power between 2025 and 2032. That is more than three and a half cents of every dollar the American economy produces, in each of those eight years. The railroads of the Gilded Age took a little over two cents. The interstate highways and the fibre boom of the late 1990s took about one cent each. As a share of the economy, the AI buildout is larger than any of the great American building booms he measured.
The companies that want the computing cannot pay for it from what they earn. By the paper's count, Oracle, Microsoft, Amazon, Meta and Alphabet are expected this year to spend more on buildings and machines than their businesses bring in as cash, for the first time. So the money comes from outside, through leases and joint ventures and private credit and bonds sold by special vehicles like Beignet. Van Nieuwerburgh states the result in one line: "These arrangements transform rather than eliminate risk."
Hyperion shows how the transformation works, and Meta's own quarterly filing for September 2026 sets out the terms. The lease begins in 2029. Its first term is four years, and Meta may renew it in steps up to twenty. If Meta walks away, it guarantees the owners part of the value of the campus, up to a cap. The filing then says: "RVG payments are not probable, and therefore no liability has been recorded to date." RVG means the residual value guarantee. Meta also keeps the whole venture off its balance sheet. Its own analysis found that the choices that matter most to the venture are about finding new tenants and selling the buildings, and that those choices do not belong to Meta.
The terms set two clocks side by side. The bonds run for almost twenty-four years. The lease can end after four. The chips in the halls, on the paper's assumption, are worth running for about six years. So the party with the shortest commitment decides what the campus is used for, and the long years belong to the people who lent. Meta pays for this. The paper estimates the bonds cost at least a full percentage point more than Meta's own borrowing, and the lease passes that cost back to Meta. The price buys a balance sheet that looks light, which is worth a great deal to a company valued for its growth.
The long years end up in many hands. Pimco anchored the Beignet bonds, and Pimco invests the savings of pension funds and households. Moody's counted nearly a trillion dollars of data center lease commitments at the five big cloud companies at the end of 2025, and found that about two-thirds were for leases not yet begun and so not yet on their balance sheets. That sum was larger than all their adjusted debt. In Louisiana the Public Service Commission voted in August 2025 to let Entergy build three gas plants for the campus. The power contract with Meta runs fifteen years and a gas plant runs for decades. And in August 2026 Nvidia signed preliminary agreements with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs and KKR to raise more than five hundred billion dollars for AI infrastructure. Jensen Huang said Nvidia may guarantee up to a quarter of the value of the equipment in a deal. The company that sells the chips now promises what they will be worth.
The paper also measures what the buildout must earn. For the capacity finished by 2032 to return ten percent a year, it needs revenue of about three point seven trillion dollars a year. By the paper's estimate that is about thirty-seven times what OpenAI and Anthropic, the two leading model companies, take in together today. The price it needs for an hour of chip time sits near what the market charges now. The risk is whether that price holds once the country has added all this capacity at once.
The strongest case against alarm comes from the same pages and from Meta's accounts. Meta brought in close to a hundred billion dollars of operating cash in the first nine months of 2026, many times what it owes each year on its debts. The guarantee is real, so if Hyperion loses value Meta pays much of the loss. The bondholders are large professional investors who chose long, steady income at an A-plus rating. Van Nieuwerburgh writes that distress is not imminent. And the old booms left their works behind them. Jay Cooke and Company failed in September 1873 over the bonds of the Northern Pacific Railway and set off a national panic, but the line was finished ten years later and freight still runs on it. Global Crossing filed for bankruptcy in January 2002, and the cable it laid under the oceans went on to carry the internet.
That case is right about the works, and it shows where the losses went. In 1873 and in 2002 the country kept the rails and the cable, and the people who had lent against them took the loss. The AI buildout is arranged the same way with one change. The companies that decide how much to build, and for what, have written contracts that let them leave early. Most of the long years sit with the lenders, the savers behind them, the ratepayers of north Louisiana whose gas plants will outlast the power contract, and now the chipmaker that guarantees its own goods. The paper asks for better measurement and disclosure while the industry's finances are still taking shape. At Hyperion they have already taken shape.
Meta's lease on Hyperion begins in 2029 and its first term ends in 2033. The bonds are due in May 2049.