I Squared bets on AI inference with $225 million data center buy from Cogent

• The acquisition includes 53 megawatts of power capacity and 259,000 square feet of colocation space across nine U.S. markets including Chicago, Atlanta, and Houston
• I Squared will use these assets as a 'seed' for a new U.S. data center operating platform with $1 billion committed for future upgrades, expansions, and acquisitions
• The deal emphasizes the infrastructure shift from large centralized data centers for AI model training to distributed facilities deployed closer to end-users for AI inference applications

I Squared Capital Acquires Cogent Data Centers for $225M in AI Infrastructure Play

Investment manager I Squared Capital announced Tuesday the acquisition of 10 data center facilities from Cogent Fiber for $225 million in cash, positioning itself to capitalize on growing AI inference demand.

Transaction Details:

• Purchase includes facilities across nine U.S. markets, including Chicago, Atlanta, and Houston
• Assets comprise approximately 53 megawatts of power capacity and 259,000 square feet of colocation space
• I Squared plans an additional $1 billion investment for upgrades, expansions, and future acquisitions
• Acquisition will serve as the foundation for a new U.S. data center operating platform

Strategic Focus:

The deal highlights a significant market shift from large, centralized data centers used for AI model training to distributed facilities positioned closer to end-users for AI inference—the deployment phase where AI models perform real-world tasks. According to I Squared co-founder Gautam Bhandari, the acquired facilities offer critical advantages: strategic location, power availability, and connectivity in markets with severely constrained new supply.

Companies Involved:

Cogent Fiber operates as an indirect wholly owned subsidiary of internet service provider Cogent Communications Holdings. I Squared Capital specializes in digital infrastructure investments, including data centers.

Market Context:

The transaction represents I Squared's continued expansion in the data center sector, following last month's agreement to acquire a majority stake in Elea, Brazil's largest carrier-neutral data center platform.

Market Implications:

The substantial investment underscores growing institutional confidence in AI infrastructure, particularly edge computing facilities that support inference workloads. The $1 billion committed capital signals expectations for continued AI adoption and infrastructure demand across distributed computing environments.